Now been observed in some extent the key movements in the debt markets, where the yield on 10-year-old Greek market has dropped below the previous lows of the year. Yield of Spanish bonds with the same maturity and punched at least one year, approaching the region of 5%. Of course, one can not compare Spain and Portugal, but in both papers over the last 2-3 sessions yield dropped by 30 points.Short-term, once it became apparent that the euro sold off at a maximum, as it was yesterday in early trading in Europe. Ultimately, though remains a decent dynamics in markets away from bonds, partly increase the likelihood of increasing the size of the fund EFSF, supports the single currency.
And here the whole thing. Divergence between the pivotal countries and the periphery in terms of economic indicators are much wider than ever. While employment in Germany is growing, the latest data from Spain showed the sharpest increase since early 2009. While you should always be skeptical of monthly data, similar to the trend observed for 6 months.
Dilemma for the ECB now is that the higher rates this year could increase economic imbalances across the euro zone. While Germany and France are moving towards agreement on a plan more consistent "economic government" (according to FT), the application of these rules and results appear to take years, not months.
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