Spain: PM Sanchez is likely to throw the towel in the ring and call snap election - ING

"After months of trying to convince Catalan lawmakers to support the 2019 budget, Prime Minister Sanchez is likely to throw the towel in the ring and call snap elections," ING economist Steven Trypsteen wrote in a recently published article. "We see a right-wing government or political gridlock as the most likely outcomes."

Key quotes

"Recent polls still show that the PSOE is the leading party with about 24% of the votes. The two large right-wing parties, the PP and Ciudadanos, follow with about 20% and 18%, respectively, of the votes. Podemos is fourth with about 14%. A new factor in the political equation is VOX. In recent polls, the party achieves about 10% of the votes. The political fragmentation in Spain is therefore here to stay and forming a coalition will be necessary."

"All in all, political uncertainty is bound to remain high in Spain, hurting investment and hiring decisions. The economy is still growing at a fast pace, although annual growth slowed from 3.1% in 2017 to about 2.5% in 2018. Given the weaker external environment, we also see the Spanish economy slowing further in 2019 to about 2% annual growth. Political gridlock could further hamper the economy, though the better state of the economy should make political tensions less dangerous than a few years ago. We don’t exclude some widening in Spanish bond spreads, but this is unlikely to go very far."

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD steady around 1.1240 in ultra-thin holiday's trading

The EUR/USD pair bounced some 20 pips from its weekly low during the Asian session, now mute around 1.1240 with most market's off today. Softer-than-expected US housing data passed unnoticed.


GBP/USD battling around 1.3000

The GBP/USD pair is heading nowhere fast after bottoming for the week at 1.2978, amid lack of progress in Brexit negotiations.  Encouraging UK data failed to trigger Pound's demand.


USD/JPY: On track to close in the middle of its 50-pip weekly range below 112

The USD/JPY pair remains frozen below the 112 handle in the NA session and there is no reason for it to make a meaningful move as investors are already enjoying the Easter holiday.


The Tale of the Prosperous Consumer-US Retail Sales

American consumers asserted the right to spend in a grand fashion in March boosting retail sales to the fastest expansion in 18 months as the booming job market put the shutdown marked holiday season to rest.

Read more

Gold Forecast: Eyes 8-month rising trendline after weakest weekly close since December

The troy ounce of the precious metal lost around $17 this week and now looks to record its lowest weekly close since the end of December near $1275.

Gold News