For weeks now, eurozone leaders and others have been waiting for Spain to ask for a bailout. Spain has even been encouraged to ask for a bailout. But the country’s leaders have been reluctant. Now, it looks as though Spain might be ready, and the euro is heading higher as a result.
Signs now point to the possibility that Spain is ready to ask for a bailout. Spain’s recent budget release indicates that the country is willing to meet austerity measures required for a bailout from the European Stability Mechanism. Stress tests of Spanish banks indicate that close to 60 billion euros are needed for recapitalization.
It looks as though Spain’s leaders are preparing themselves to ask for aid, and this is helping the euro right now. After weeks of fluctuations and uncertainty, there is optimism for the eurozone as Spain moves closer to asking for help. However, the euro is still vulnerable. Will Spain ask for help in time? And, even if Spain does ask for help, there are still questions about Portugal and Italy, and concerns lingering about Greece.
At 12:53 GMT EUR/USD is up to 1.2923 from the open at 1.2888. EUR/GBP is up to 0.8004 from the open at 0.7990. EUR/JPY is up to 100.9565 from the open at 100.5200.
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