Rajoy Vs The Rest 13th June, Uk Forex Update

Vantage FX (http://www.vantagefx.co.uk/) provides a daily overview of the news activity

and announcements currently shaping currency movements across the world. Jay Mawji, the companys head of market analysis, takes a look at news surrounding Eurozone economies on 13th June 2012.

You would expect a Eurozone leader whose country is in a desperate state - having just claimed 100bn worth of assistance, to be fairly reserved and grateful to his saviours.

Instead, Prime Minister Rajoy in Spain along with Mario Monti in Italy are joining together to take on the Eurozone and change the way that the EU is viewing and dealing with their struggling economies. It all started with a text message he sent to his finance minister who was sitting in an EU negotiation, reminding him to be strong and get a fair deal Spain is not Uganda were his summarising words. The Prime Minister of course left Spain after receiving a bailout to watch Spain vs Italy in the Euros shortly after. It is unlikely that such arrogance is going to win the hearts or minds of other Eurozone leaders who face tough questions on what to do next in the Eurozone. Eurozone leaders have expressed their willingness to let Greece exit the Eurozone, with some even calling for the Grexit. One would think a touch too much from Spain could find them quickly become the new undesirables in the economic area.

The Irony of the whole situation for Spain is that what Rajoy and Monti ask for is something close to what the financial markets would see as ideal. The first is to do with the buying of bad debt from Eurozone nations. Rajoy would like to see the EU buy up bad debt from smaller Eurozone countries to help them manage their debt ratios. The second step would be the introduction of a unified debt system to apply to the Eurozone, to effect a unified strategy to reduce debt and increase growth. Eurobonds have been called for in the past and many feel that a Eurobond would calm fears but also prevent victimisation on weaker economies. The third phase would be to then introduce fiscal policy to stimulate growth in the Eurozone as opposed to measuring an economy based on its reduction of debt through strict austerity measures which have clearly failed.

As Greece votes in a new government, Spain and Italy rally together and Hollande taking a different route in France; Angela Merkel could find herself as a lone horse and may well be out voted in Europe and in her German Parliament. Is the Eurozone ready for this battle?

About Vantage FX UK

Vantage FX UK is a FX trading broker based in the City of London, providing foreign exchange trading services to clients in the UK, the EU and the rest of the world.

What sets Vantage FX apart is its wide range of services and outstanding level of customer support. The company strives to provide an intuitive, interactive Forex experience by continually innovating and taking advantage of the latest trading technology, such as MetaTrader 4 and Expert Advisors.

Vantage FX also offers extensive educational resources to help give traders their edge, keep up with daily market commentary and try a FX trading demo account.

by: Vantage FX UK

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