FXstreet.com (Barcelona) - Moody's downgraded five Spanish regions while affirming the ratings of five other regions. In particular, Catalonia was cut to Ba3 from Ba1 while two regions, i.e. Andalucia and Extremadura were cut to junk.
In other news, ECB Governing Council member Mersch noted that the ECB can “tolerate slightly higher inflation right now as it is expected to come down next year.” He also noted that the Target2 imbalances in the Eurozone are declining - suggesting that the crisis is waning.
Furthermore, ECB Vice President Constancio stated direct bank recapitalizations cannot start until 2014. He reiterated the importance of separating monetary policy from the supervision responsibilities of the ECB and added that the ECB agrees with the European Commission of the plan for single supervisory mechanism. According to Research Analyst Gareth Berry at UBS, “Despite the pairs negative performance today, the EUR/USD remains bullish in the near-term, targeting 1.3091 with further resistance at 1.3140/72.”
In other news, ECB Governing Council member Mersch noted that the ECB can “tolerate slightly higher inflation right now as it is expected to come down next year.” He also noted that the Target2 imbalances in the Eurozone are declining - suggesting that the crisis is waning.
Furthermore, ECB Vice President Constancio stated direct bank recapitalizations cannot start until 2014. He reiterated the importance of separating monetary policy from the supervision responsibilities of the ECB and added that the ECB agrees with the European Commission of the plan for single supervisory mechanism. According to Research Analyst Gareth Berry at UBS, “Despite the pairs negative performance today, the EUR/USD remains bullish in the near-term, targeting 1.3091 with further resistance at 1.3140/72.”
