More Gloom for the Eurozone?
With the recent credit down-grading of a number of Eurozone countries, including France, are we about to finally see the start of the Euro break-up? Well if I had a crystal ball I could give you the answer! As it stands each piece of negative news is followed by a positive one and vice versa. What is clear is that the continuing crisis within the Eurozone plays directly into the hands of the doomongers who continuously talk of the inevitability of the final euro breakdown. As more and more details are released concerning the French/German efforts to stabalise the eurozone, it is becoming increasingly clear that there plans are flawed. This in turn places more pressure on the euro, forcing it down to currently record lows against the US Dollar. Add to this the news from Greece that they are unlikely to be able to repay the next loan instalments – a key factor in allowing further bail-out money to be given to the country - and you begin to see how constant talk of a breakdown of the Eurozone has increasing credibility As I indicated already, each piece of negative news is followed by a positive one. In this case, as the Euro sinks, so the good old British Pound rises. As I write this, GBP currently stands against the Euro at over 1.21 Only a matter of weeks ago we were looking at 1.14, so in effect, the pound has risen by over 6% in less than six weeks (I wouldn’t mind that sort of interest rate from my Bank ! ) . But what about the UK ? Unfortunately the UK media has always prospered on the basis that ‘bad news is good news’. Any positive comments from the Government are quickly given a negative spin. Only this Saturday a report predicted the UK in 2012 would avoid recession but that growth would ‘flatline’. Then come Monday, the news channels reinterpret this to mean the UK