Daily Archives: June 28, 2012

Hollande called “quick fixes” for countries threatened by the markets

French President François Hollande, today called “very fast solutions” for countries that are “threatened by the market” despite having made a “considerable effort” of reforms.

“I come very quickly to provide solutions to support countries that have more difficulties in the markets, even if they have made ​​considerable efforts to steer public accounts,” Hollande said in a statement on his arrival in the European Union summit .

Hollande, who did not cite to any particular country, said that action should be undertaken by “solidarity”.

The French president said his other priorities for this summit is growth, but with “a covenant with figures” to commit 1% of EU GDP, about 130,000 million euros to be invested “quickly” to create jobs.

Hollande said that the summit will discuss closer economic integration and greater solidarity between EU partners, the report of the European Council President, Herman Van Rompuy.

But he insisted: “We need immediate action to countries that have made ​​efforts but can not stand the pressure of the markets.”

Rajoy hopes the summit will adopt measures to ease the pressure on Spain

The Spanish prime minister, Mariano Rajoy, now entrusted to the European summit which starts this afternoon in Brussels to take “any decision” to lower the cost of financing in the markets of Spain.

“Right now the price of credit to Spain is obviously very expensive and I think the European Union and the Economic and Monetary Union must be aware that this is so, and that a decision must be taken,” said Rajoy on arrival at a previous meeting of the European People’s Party (EPP).

Asked about the option of a direct recapitalization of Spanish banks, the chief executive has said it is “one of the possibilities that are open,” but stressed that this issue not be resolved today.

The Prime Minister has insisted that the resolution of the problem of “debt sustainability” is “fundamental” and assured that any other measure “is useless if we can not fund.”

“We financing at prices too high and there are many Spanish public institutions can not even funded. This is the key issue,” he stressed.

Asked about measures to reduce those costs of funding that can be taken at the EU summit today and tomorrow, Rajoy has stated that the “position of Spain is already known” and he will defend, but recalled that “decisions are made in most cases unanimously and that complicates things. ”

“What comes out of all this, as we shall see,” said.

Together with this high priority, Rajoy has argued that out of the current EU countries should “continue cleaning up” their public accounts, to agree on measures to reform and growth.

Among them, the Spanish prime minister has argued that the European Investment Bank (EIB) to finance small and medium enterprises, which has been considered a “key priority” to fight unemployment in the country.

Asked about the option of a direct recapitalization of Spanish banks, the chief executive has said it is “one of the possibilities that are open,” but stressed that this issue not be resolved today.

Rajoy has said that this route, which would mean that the European rescue fund capital injecting problems in States without passing through the state “has its advantages and disadvantages.”

It’s, recalled that “the union would go into banking” is the debate and hope that today the point “some ideas” about the topic at the meeting of heads of State and Government of member countries.

ILO warns of deteriorating public sector in Europe

Adjustments “unprecedented” public sector, combined with a lack of social dialogue between governments and workers, job security has deteriorated and salary of public employees in Europe, warned in a report the International Labour Organization (ILO .)

The document entitled “Setting the Public Sector – Overview, Impact and Policy Issues” notes that “the hasty pressure to reduce public spending tends to favor quantity adjustments, primarily through cuts in spending, jobs and wages in the public sector. ”

“All these changes can not be neutral in the future quality of public services. It is something that remains to be seen in education and health, but also threatens the jobs in public administration,” said ILO expert and responsible for the report, Daniel Vaughan-Whitehead.

The study notes that in several European countries public employees have already lost their wage advantage they had with respect to private sector workers, that “it empirically justified by higher levels of education in the public sector.”

According to Vaughan-Whitehead, “the decline in wages and employment in the public sector, compared with the private sector has not only resulted in a shift of workers, especially doctors, nurses and teachers.”

“In addition, the public sector has also ceased to attract the most qualified graduates who had been its lifeblood,” said ILO expert.

The report also warns of worsening of the “social climate” in the public sector and calls for “strengthening the dialogue between governments and workers, and consider a better combination of tax considerations and other”.

“Equality, social dialogue, employment prospects, working conditions, and future efficiency and quality of public services deserve more attention. Only under these conditions the utility will remain an important source of social cohesion and economic growth, “said Vaughan-Whitehead.

Banking employers believed that the breakdown of the monetary union is “likely”

The president of the bank employers (AEB), Miguel Martin, said today that a break in the euro zone is not only possible but “even probable.”

Speaking at a course on the euro crisis in the International University Menéndez Pelayo (UIMP), Martin has argued that Europe’s problem is the lack of competitiveness and that “we are content to have a mild recession.”

Michael Martin has held that the sovereign debt crisis comes from the fear that a default occurs, as happened in Greece, making bondholders, who are mainly banks, treating such titles as “risky assets” .

He criticized the injections of liquidity by the Central Bank (ECB), because “it is a false solution”, which gives money to banks to invest in sovereign debt and become increasingly vulnerable.

So, has insisted that “the problem is that Spain’s economy is not competitive,” so you need an “internal devaluation” to sell cheap, especially to Germany, but with respect to social cohesion.

At the same time, has supported fiscal consolidation in order to become less dependent on markets because “we are going to take a hard”.

In that regard, he added that European aid money must use it “wise” to be more solid and solvent entities because, otherwise, it could even be a negative measure.

To avoid breaking the euro, Martin has chosen to create a rescue fund that can take direct stakes in banks and issuing “some kind of common sovereign” and start the path to a banking union.

He also noted that the employer does not want public money to clean up the banking costs not borne by the taxpayer and has recognized that although the problem of Spain are not banks, “there are other banks that have created a problem.”

Regarding the preferred stock, has suggested that each entity is “responsible” for their emissions, but that if an entity has problems and “is not responsible for itself” nor shall bear the titles.

European markets opened almost flat on the day of the decisive summit of euro

European markets opened almost flat today, pending the opening of this evening’s EU summit, described as crucial to the future of the euro.

The Milan Stock Exchange today opened upward and selective index, FTSE MIB rose 0.21% and was equal to 13,333 points.

The London Stock Exchange rose 7.48 points, or 0.14 percent, and stood at 5531.40 integers, while the Frankfurt also opened upward and DAX 30 at first rose 0.13 percent to 6,237 units.

The same trend was recorded in Paris, where the CAC-40 was up 0.12 percent to reach 3,066.79 points.

In Spain, the IBEX 35 was down 0.5 percent,

The Euro opened higher in the foreign exchange market in Frankfurt and from 06.00 hours GMT was trading at $ 1.2510 compared to 1.2455 the previous day.

The risk premium on Spain touched at 09.42 local time (07.42 GMT) 550 points (549.2) after the interest of Spanish bond to ten years, whose distance from the same period the German measures country risk reached the critical level of 7%.

The additional cost that investors demand for buying Spanish debt against German widened both by rising bond yields Spanish as the slight fall of the German bond interest, which went from 1.571% to 1.508%.

Risk premiums in other peripheral countries of the euro area remained almost unchanged at this time except for Italy, which rose to 475 basis points while the yield of ten-year bond rose to 6.259%.

Analysts say markets expect to learn about the initiatives that the EU leaders can take to alleviate the debt crisis at the summit being held today and tomorrow in Brussels.

The Heads of State and Government today begins a crucial two-day summit for the euro area, which advocate for growth and employment and will try to move towards a new architecture based on a joint bank and fiscal policy.

The leaders approved an agreement to provide for growth and employment that will advocate for advancing the single market, digital and energy and a financing plan, probably endowed than 130,000 million.

Once this debate is concluded, is expected to address the Twenty-creation of a joint bank and fiscal policy that includes a European banking supervisor, a Treasury euro Eurobond vetoing budgets and limits on debt issuance.

These ideas are part of a report presented by the European Council President, Herman Van Rompuy, and on which to base the discussion of European leaders, in order to detail specific measures in December.

Annual inflation remains at 1.9 percent in June

Annual inflation stood at 1.9% in June, the same rate recorded in May, the leading indicator of consumer price index (CPI) released today by the National Institute Statistics (INE).

This listing has especially influenced the fall in prices of fuels and lubricants, which has been offset by the price behavior of snuff and food.

The INE has also published the leading indicator of CPI (HICP), which measures changes in prices by the same method in all countries of the euro area, according to which inflation has been on June 1, 8%, one tenth less than the previous month.

The leading indicator is an increase of CPI, which definitive data will be released on July 13, and usually does not vary significantly.

To match the information we have today with the publication in July confirmed the downward trend in inflation that began in May 2011, when it stood at 3.5% and was down sequentially until September, when which increased by one tenth to 3.1%

Since September there have been successive reductions in the CPI-year except April, when the rate rose to 2.1%, two tenths more than that recorded in the previous month.

The INE started spreading the leading indicator of CPI in January 2011, because from that date the methodology for calculating the CPI and the HICP differ in the treatment of clothing and footwear, and fruits and vegetables by the entry into force of regulatory change in the European Commission.

Although the INE published an advance indicator of the HICP since 2004, from 2011 offers complete information on the evolution of consumer prices.