Irish Taoiseach Enda Kenny traveled to Berlin on Thursday to meet with German Chancellor Angela Merkel, as part of preparations for the upcoming Irish EU presidency. The Irish and German leaders also discussed recent developments in the European debt crisis and the Irish bailout program.
Edna Kenny, who reiterated that Ireland was a "special case," expressed hope for a renegotiation of the rescue conditions in order to help its indebted banks. He also stressed that the Eurogrop should support the country's efforts to return to bond markets and pointed out that many countries in the Eurozone are currently facing “enormous challenges.”
Angela Merkel praised the country's progress in implementing reforms which proves that it is possible to effectively fight the crisis. She added that the priorities for the Irish EU presidency, which begins next year on January 1, would be stimulating growth and employment.
Poor EU PMI data hints at lack of growth in the area in 2Q 2012
European stock markets were higher in morning trade on Thursday, despite the fact that several of the European manufacturing PMI readings came in worse than expected. The most closely observed was the UK PMI data which revealed that the British manufacturing sector shrunk further to 47.5, which is almost the worst result in a year.
James Knightley from ING believes that this outcome might push the BoE to introduce more QE at the upcoming meeting on November 8: “With the economy remaining stagnant and external growth risks having barely changed we still take the view a narrow majority will vote in favour of a £50bn expansion in the Asset Purchase Facility.”
Eurogroup delays decision on Greek aid until Nov 12
Eurozone finance ministers said there's no guarantee Greece will be given its next round of aid in a couple weeks, according to media reports. Ministers held a conference call to discuss possibly giving Greece extra room to meet deficit targets that are part of its bailout agreement.
Even though finance ministers took note of progress toward an agreement between Greece and the troika, they urged Greek authorities "to solve remaining issues so as to swiftly finalize the negotiations", in Jean-Claude Juncker words.
The Eurogroup decided to delay to November 12 the decision on the potential allotment of the bailout tranche, which Greece needs to avoid bankruptcy, totaling €31,5billion.
Spanish government will not request any financial rescue throughout 2012
According to Spanish government officials, President Mariano Rajoy will not ask for any financial help during the rest of the present year. The ECB would have approved the decision already.
The news just confirm the previous reluctance showed by Rajoy, when he stated in previous comments that the Mediterranean country could still wait before asking for help, ruling out any request before the next year.
With the country’s debt issuance almost covered for the present year plus not-so-bad results in domestic fundamentals as of late and the banking union oriented in the right direction, the decision by the Spanish government seems to be well supported.
Furthermore, ECB’s Ewald Nowotny has commented that Spain would not need to ask for financial aid at the moment, hinting that the ECB was up-to-date about the decision.
All in all, the government has left the door open for a probable request in the future, however it won’t be soon.