Demonstrators in Madrid – angered over a recession, a 25% unemployment rate (the rate is above 50% for those under age 25), tax hikes, and new “austerity” spending cuts – saw their protests turn violent as they clashed with riot police for the third time in several days.
Spain’s debt levels are set to rise next year, piling pressure on the government to apply for aid as it pours funds in to cash-strapped regions, an ailing banking system and rising refinancing costs, its budget showed on Saturday.
Spain’s debt as a ratio of gross domestic product (GDP) will reach 90.5% by end 2013, according to the document presented to parliament for approval, almost three times that registered before the property bubble burst in 2008.
The budget aims to make savings of around €13bn ($16.7bn) next year, largely by deepening already unpopular cuts in public sector wages, education, health and social services, fuelling anti-austerity protests.
“This is an austerity budget, but will serve to help us get over this long economic crisis and once again show that Spain is a trustworthy partner within Europe,” Treasury Minister Cristobal Montoro told journalists after delivering the budget.
A likely cross of the euro’s 5-day moving average below its 20-day moving average would confirm the downtrend, he said. The latter is now at $1.2884 and the former is now at $1.2871.
A break of the $1.2775-$1.2800 area would signal another 1 to 2 percent decline, while a move above the $1.3000-50 area would be needed to signal any new leg higher, Chandler said.
Resistance is seen at $1.2960, the 38.2 percent retracement of its Sept. 17-27 slide.
Despite the euro’s weaker technical tone, currency speculators boosted bets against the dollar in the latest week to the highest in more than a year, according to data from the Commodity Futures Trading Commission released on Friday.
The euro also skidded about 0.5 percent against the yen, falling to 99.84, not far from a two-week low of 99.64 hit on Thursday.
The dollar was down about 0.2 percent against the yen but off a more than two-week low of 77.43 yen hit on Friday, changing hands at 77.88 yen.
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Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.Read the Terms of Service