Ireland Faces Severe Austerity
Ireland’s government has said today that spending will be cut by 20% and taxes will rise over the next 4 years as the ongoing bailout talks approach a conclusion. Welfare will be cut by €2.8 bn and income tax will rise to €1.9 billion. The plan is to rapidly narrow the budget deficit reigning in the debt to GDP ratio to 3%. This years deficit is 12% or 32% if you include the banks rescue package. These figures will undoubtedly weigh on the Euro in trade both this week and next. The fear is that this could be a taste of what is to come in other Eurozone areas.
Elsewhere the USD has strengthened as Americans increase spending for the 5th month in a row. They have also filed fewer unemployment claims, both of which suggest that the US economic situation is improving. Stocks have rallied and Treasuries declined as the economic releases today along with the increase in consumer confidence have helped to improve the outlook for the up coming holiday season.
It seems that a US recovery is gaining momentum and the S&P and the Dow are both reflecting this in afternoon trade today. Economic activity in the UK is at 0.8% in Q3 in the UK, the market didn’t really respond dramatically to this announcement as broader global concerns continue to dominate price action.
Attacks between South and North Korea remain in traders forethoughts, and have lead to considerable risk aversion. The GBPUSD pair may continue to come under pressure as growth concerns continue to concern traders.
Tomorrow sees a market holiday in the US which should contribute towards lower trading volumes and less volatility.
Best Regards
Luke Zorab
Torfx Currency Dealer
00441736 335285
If you have any currency requirements or have any questions or queries with reference to the markets please don’t hesitate to contact me
Most Popular Content
- Pressure Mounts on the British Pound Following Autumn Budget
- Impact and Outlook for the U.S. Economy on Rate Cut
- Gold and Copper Markets Respond to Powell
- US Stock Market Faces Turbulence and Mixed Commodity Reactions
- Pound Holds Strong as Labour Wins with a Landslide
- Crude Oil Prices Rally as Inventory Declines and Rate Cut Hopes Emerge
- Strength in Gold and Copper Continues – But for How Long?
- Weak Payroll Data Sends Stocks Higher
Currency Articles - Nov 3, 2024 13:35 - 0 Comments
Pressure Mounts on the British Pound Following Autumn Budget
More In Currency Articles
Gold and Oil News - Aug 24, 2024 16:06 - 0 Comments
Gold and Copper Markets Respond to Powell
More In Gold and Oil News
- US Stock Market Faces Turbulence and Mixed Commodity Reactions
- Crude Oil Prices Rally as Inventory Declines and Rate Cut Hopes Emerge