To stay or not to stay? That is the question that some countries within the Eurozone are asking themselves right now as those less affected by the debt crisis start thinking of exit strategies as self preservation takes priority.
By Luke Trevail of TorFX
With continued poor economic figures being posted from almost every part of Europe, the cloud hanging over the single currency shows no sign of clearing, despite the summery weather.
News this week showed that Spain’s recession worsened in the second quarter as the Government’s austerity push to reduce the budget deficit, and a slump in consumer spending, offset growth in exports. This bad news followed downbeat comments last month by Prime Minister Mariano Rajoy who appears to have given up hope of economic growth before 2013, whilst unveiling budget cuts that will make matter worse.
Currency wise, client’s buying the Euro are able to secure prices above €1.25 right now but this is likely to improve as more countries put forward a reason to exit the Euro, with Finland leading the charge this week.
Any hoarders of Euros holding off and praying for a better rate should wake up and realise that it’s a ticking bomb, and prices now are likely to be a good as it gets with continued woe likely to be heaped on the European economy.