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Eurozone crisis live: New warning over Greek recession Eurozone crisis live: New warning over Greek recession
(40 minutes later)
12.01pm: While Greece is braced for an even deeper recession than feared (see 10.39am), Germany still expects to post growth this year.
Reuters quotes a government source in Berlin who says the German government will announce tomorrow that the economy will grow by 0.7% in 2012, which represents 'no change' on the previous forecasts.
Germany also still expects to post growth of 1.6% in 2013.
11.26am: The Dutch parliament face a tricky challenge today. Following the resignation of PM Mark Rutte yesterday, can the Netherlands reach an agreement on its budget that will satisfy the eurozone?
Rutte is continuing as caretaker leader, while the political ramifications of the breakdown of relations with former ally Geert Wilders are digested.
The clock is ticking too -- the Dutch government must deliver a preliminary 2013 budget to Brussels by April 30. That must explain how the Netherlands will bring its budget deficit below the 3% limit in 2013 (from a projected 4.6% deficit this year).
MPs must also agree the date of a new general election. There are reports today that a narrow majority of leaders favour a June 27 election, while other parties would rather wait until September.
As the Press Association explains:
It is ultimately up to the caretaker government to decide on a date. According to the country's electoral commission, a deadline for parties to submit their lists of candidates must be set around 40 days after parliament is officially dissolved and elections are held 43 days after the registration deadline.
We're still expecting Mark Rutte to address The Hague parliament at 2pm local time (1pm BST).
11.03am: Senior officials from the Big Three credit rating agencies are appearing before the UK parliament's Treasury Committee. My colleague Jo Moulds is watching, and provides some of the highlights:11.03am: Senior officials from the Big Three credit rating agencies are appearing before the UK parliament's Treasury Committee. My colleague Jo Moulds is watching, and provides some of the highlights:
Moritz Kraemer of Standard & Poor's defended his firm's decision to cut the US credit rating, while still maintaining a AAA rating on several eurozone countries, such as Finland.Moritz Kraemer of Standard & Poor's defended his firm's decision to cut the US credit rating, while still maintaining a AAA rating on several eurozone countries, such as Finland.
Kraemer, S&P's managing director and head of the sovereign ratings group for Europe, Middle East and Africa, told MPs he did believe that US's capacity to pay back its debt is lower than Finland (despite having full control of its own currency):Kraemer, S&P's managing director and head of the sovereign ratings group for Europe, Middle East and Africa, told MPs he did believe that US's capacity to pay back its debt is lower than Finland (despite having full control of its own currency):
One of the key elements in the methodology is the political environment. You will notice two things. The debt ratio in the US is much higher and the debt trajectory is more adverse. We felt that the government challenges that the US political system is facing are more pronounced than they are in Finland.One of the key elements in the methodology is the political environment. You will notice two things. The debt ratio in the US is much higher and the debt trajectory is more adverse. We felt that the government challenges that the US political system is facing are more pronounced than they are in Finland.
Specifically last summer the US government got really close to a liquidity crisis.Specifically last summer the US government got really close to a liquidity crisis.
Kraemer declined to speculate on what rating an independent Scotland might receive.Kraemer declined to speculate on what rating an independent Scotland might receive.
David Riley, managing director for Sovereign & Supranational Ratings at Fitch, was a bit more forthcoming:David Riley, managing director for Sovereign & Supranational Ratings at Fitch, was a bit more forthcoming:
I'm not aware in terms of Fitch whereby a newly independent sovereign in Central and Eastern Europe has been assigned a AAA rating, but I think the transition of Scotland from the UK would be fundamentally different from Eastern European countries.I'm not aware in terms of Fitch whereby a newly independent sovereign in Central and Eastern Europe has been assigned a AAA rating, but I think the transition of Scotland from the UK would be fundamentally different from Eastern European countries.
Alastair Wilson, chief credit officer at Moody's, said the ability to have independent domestic institutions is a strength, as is the ability to devalue the currency:Alastair Wilson, chief credit officer at Moody's, said the ability to have independent domestic institutions is a strength, as is the ability to devalue the currency:
The existence of strong institutions that are able to support government policy is certainly a factor. [the ability to deflate currency] is certainly a factor that can boost economic growth.The existence of strong institutions that are able to support government policy is certainly a factor. [the ability to deflate currency] is certainly a factor that can boost economic growth.
10.39am: More bad news from Greece, the country where the eurozone debt crisis began.10.39am: More bad news from Greece, the country where the eurozone debt crisis began.
Barely a month after his last report, Bank of Greece governor Giorgos Provopoulos is predicting that contraction of the nation's economy this year is going to be even worse than thought.Barely a month after his last report, Bank of Greece governor Giorgos Provopoulos is predicting that contraction of the nation's economy this year is going to be even worse than thought.
Helena Smith, our correspondent in Athens, reports:
/> 		Helena Smith, our correspondent in Athens, reports:
In his annual report the Bank of Greece governor says he expects the country's GDP will fall by 5% this year – in March he had estimated the economy would probably shrink at about 4.5%.

Unemployment, already at a record high of 21.8% (with joblessness affecting over 50% of the nation's youth) would worsen as a result, says the report.

Wages, predicted Provopoulos, will decline by a further 10% this year following enforcement of yet more austerity measures. Greeks have already seen their pay packets and pensions docked by an average 25% since the crisis erupted in Athens in December 2009.

The governor, who has repeatedly criticized Greek officials for failing to implement reforms that would free up the economy and boost competitiveness, said he did not expect the economy to rebound before "the end of 2013." The technocrat prime minister Lucas Papademos, a former vice president of the European Central Bank. had forecast the turnaround happening "by mid 2013." Greece is currently experiencing its fifth straight year of recession in what has become its worst slump since WWII.

In the much-awaited overview Provopoulos is also expected to emphasise the need for a "comprehensive growth plan" to get Greece out of its economic death spiral.		In his annual report the Bank of Greece governor says he expects the country's GDP will fall by 5% this year – in March he had estimated the economy would probably shrink at about 4.5%.

Unemployment, already at a record high of 21.8% (with joblessness affecting over 50% of the nation's youth) would worsen as a result, says the report.

Wages, predicted Provopoulos, will decline by a further 10% this year following enforcement of yet more austerity measures. Greeks have already seen their pay packets and pensions docked by an average 25% since the crisis erupted in Athens in December 2009.

The governor, who has repeatedly criticized Greek officials for failing to implement reforms that would free up the economy and boost competitiveness, said he did not expect the economy to rebound before "the end of 2013." The technocrat prime minister Lucas Papademos, a former vice president of the European Central Bank. had forecast the turnaround happening "by mid 2013." Greece is currently experiencing its fifth straight year of recession in what has become its worst slump since WWII.

In the much-awaited overview Provopoulos is also expected to emphasise the need for a "comprehensive growth plan" to get Greece out of its economic death spiral.
With the country heading for general elections on May 6th, Provopoulos like other officials, has warned against political instability wrecking the vital economic headway the country needs to make to exit the crisis.

Fringe parties such as the neo-Nazi Chryi party, whose fortunes have risen on the back of anti-immigrant sentiment and fierce opposition to austerity measures, could capture as much as 5 % of the vote according to polls released in the run-up to the election.

Even though the crisis has now spread far beyond Greece, senior economists in Athens are not ruling out a Greek exit from the Eurozone "within the next year." Addressing bank stakeholders this morning Provopoulos also warned that the country's euro zone membership was at stake if it failed to commit to its promises to reform.

"If following the election doubts emerge about the new government and society's will to implement the programme, the current favourable prospects will reverse," he said.		With the country heading for general elections on May 6th, Provopoulos like other officials, has warned against political instability wrecking the vital economic headway the country needs to make to exit the crisis.

Fringe parties such as the neo-Nazi Chryi party, whose fortunes have risen on the back of anti-immigrant sentiment and fierce opposition to austerity measures, could capture as much as 5 % of the vote according to polls released in the run-up to the election.

Even though the crisis has now spread far beyond Greece, senior economists in Athens are not ruling out a Greek exit from the Eurozone "within the next year." Addressing bank stakeholders this morning Provopoulos also warned that the country's euro zone membership was at stake if it failed to commit to its promises to reform.

"If following the election doubts emerge about the new government and society's will to implement the programme, the current favourable prospects will reverse," he said.
10.21am: A bit more bond auction action -- Italy has seen its borrowing costs jump, selling €3.34bn of debt at the highest costs since January.10.21am: A bit more bond auction action -- Italy has seen its borrowing costs jump, selling €3.34bn of debt at the highest costs since January.
Bloomberg is reporting, though, that Switzerland managed to sell 922.5m Swiss francs of debt at negative borrowing costs today:Bloomberg is reporting, though, that Switzerland managed to sell 922.5m Swiss francs of debt at negative borrowing costs today:
Switzerland sells CHF922.5million of 91-day bills at a negative yield of -0.158%Switzerland sells CHF922.5million of 91-day bills at a negative yield of -0.158%
— Linda Yueh (@lindayueh) April 24, 2012— Linda Yueh (@lindayueh) April 24, 2012
10.11am: Have the Netherlands and Germany 'decoupled'?10.11am: Have the Netherlands and Germany 'decoupled'?
FT Alphaville makes a typically insightful point this morning – the cost of insuring Dutch debt against default has increased sharply in recent months, and is rather more costly than the German equivalent (having actually been cheaper a year ago).FT Alphaville makes a typically insightful point this morning – the cost of insuring Dutch debt against default has increased sharply in recent months, and is rather more costly than the German equivalent (having actually been cheaper a year ago).
This graph maps credit default swaps of Germany (black) and the Netherlands (orange) (based on Markit data).This graph maps credit default swaps of Germany (black) and the Netherlands (orange) (based on Markit data).
CDS contracts allow bond holders to protect themselves from a default of 'restructuring'. While the Greek financial aid deal showed their limitations, they're still a good guide to market sentiment. They may be showing that, even though the Dutch AAA rating remains intact, traders see Germany as a safer bet. More here.CDS contracts allow bond holders to protect themselves from a default of 'restructuring'. While the Greek financial aid deal showed their limitations, they're still a good guide to market sentiment. They may be showing that, even though the Dutch AAA rating remains intact, traders see Germany as a safer bet. More here.
9.59am: So, it looks like Holland 1, Spain 0 in the battle of the bond sales - after the Dutch auction proceeded smoothly, but Spain saw its borrowing costs nearly double. A reversal of the 2010 World Cup final.9.59am: So, it looks like Holland 1, Spain 0 in the battle of the bond sales - after the Dutch auction proceeded smoothly, but Spain saw its borrowing costs nearly double. A reversal of the 2010 World Cup final.
9.52am: Spain has not matched the Netherlands' success in the bond markets today – its borrowing costs have almost doubled.9.52am: Spain has not matched the Netherlands' success in the bond markets today – its borrowing costs have almost doubled.
Investors demanded much higher rates of return at today's Spanish auction, even though the debt on offer would mature in just three or six months. Here's the details:Investors demanded much higher rates of return at today's Spanish auction, even though the debt on offer would mature in just three or six months. Here's the details:
Spain sold €725m of three-month bills at an average yield of 0.634%, up from 0.381% a month ago....
..and €1.2bn of six-month bills at an average yield of 1.58%, up from 0.836% in March.		Spain sold €725m of three-month bills at an average yield of 0.634%, up from 0.381% a month ago....
..and €1.2bn of six-month bills at an average yield of 1.58%, up from 0.836% in March.
9.43am: UK public finance figures for March (just released) show that the UK government had to borrow over £18bn last month - more than expected.9.43am: UK public finance figures for March (just released) show that the UK government had to borrow over £18bn last month - more than expected.
George Osborne has still hit target for 2011 borrowing, though.George Osborne has still hit target for 2011 borrowing, though.
My colleague Julia Kollewe explains:My colleague Julia Kollewe explains:
Public sector net borrowing excluding the effect of the banking bailouts - the government's preferred measure - rose to £18.17bn last month, from £17.95bn a year ago, according to the Office for National Statistics. This was worse than the £16bn predicted by City economists.
However, downward revisions to previous months meant that George Osborne met his full-year target. The government borrowed £125.97bn over the 2011/12 financial year, within the Office for Budget Responsibility's £126bn forecast, and far below the £136.8bn deficit run up last year.		Public sector net borrowing excluding the effect of the banking bailouts - the government's preferred measure - rose to £18.17bn last month, from £17.95bn a year ago, according to the Office for National Statistics. This was worse than the £16bn predicted by City economists.
However, downward revisions to previous months meant that George Osborne met his full-year target. The government borrowed £125.97bn over the 2011/12 financial year, within the Office for Budget Responsibility's £126bn forecast, and far below the £136.8bn deficit run up last year.
This means that the UK deficit came in at 8.3% of GDP in the 2011/12 financial year, down from 9.3% in 2010/11. Net debt climbed to £1.02 trillion in March, equivalent to 66% of GDP, the highest since records began in 1993.This means that the UK deficit came in at 8.3% of GDP in the 2011/12 financial year, down from 9.3% in 2010/11. Net debt climbed to £1.02 trillion in March, equivalent to 66% of GDP, the highest since records began in 1993.
9.39am: Hot off the Reuters terminal, here's more City reaction to the Dutch debt auction (which does appear to have passed more smoothly than feared, despite the Dutch selling less than the €2.5bn maximum target):9.39am: Hot off the Reuters terminal, here's more City reaction to the Dutch debt auction (which does appear to have passed more smoothly than feared, despite the Dutch selling less than the €2.5bn maximum target):
Michael Leister of DZ Bank:Michael Leister of DZ Bank:
The figures look all right....The negative news doesn't extend further given that the auction is ... a solid one.The figures look all right....The negative news doesn't extend further given that the auction is ... a solid one.
Marc Ostwald of Monument Securities:Marc Ostwald of Monument Securities:

It's been sold essentially around market levels which is good but the fact that they have only sold 1.995 (billion euros) against a target of 1.5 to 2.5 (billion euros) will probably have some of the ... non-bond market participants questioning whether there is really any demand and fretting.
It's been sold essentially around market levels which is good but the fact that they have only sold 1.995 (billion euros) against a target of 1.5 to 2.5 (billion euros) will probably have some of the ... non-bond market participants questioning whether there is really any demand and fretting.
[But] It's very frequent for the Dutch to sell roughly in the middle of their target range.[But] It's very frequent for the Dutch to sell roughly in the middle of their target range.
Lyn Graham-Taylor of Rabobank:Lyn Graham-Taylor of Rabobank:
The longer-dated bond is a bit of a soft result but by no means a disaster given we've seen the biggest upheaval ahead of a Dutch bond sale for many years.The longer-dated bond is a bit of a soft result but by no means a disaster given we've seen the biggest upheaval ahead of a Dutch bond sale for many years.
9.23am: Steve Collins, global head of dealing at London & Capital Asset Management, confirms that investors flocked to this morning's Dutch debt auction (details at 9.13am).9.23am: Steve Collins, global head of dealing at London & Capital Asset Management, confirms that investors flocked to this morning's Dutch debt auction (details at 9.13am).
On Twitter, Collins cited market talk that the auction closed in just two minutes (much faster than usual), encouraging traders to sell 'safe-haven' German bunds.On Twitter, Collins cited market talk that the auction closed in just two minutes (much faster than usual), encouraging traders to sell 'safe-haven' German bunds.
Hearing the Dutch book has closed after 2 minutes , rather than the usual 15 minutes as extremely well subscribed, thus the Bund selloffHearing the Dutch book has closed after 2 minutes , rather than the usual 15 minutes as extremely well subscribed, thus the Bund selloff
— Steve Collins (@TradeDesk_Steve) April 24, 2012— Steve Collins (@TradeDesk_Steve) April 24, 2012
9.13am: The results of the Dutch debt auction are in! And at first glance, it looks like a success9.13am: The results of the Dutch debt auction are in! And at first glance, it looks like a success
In fact, the auction closed within a few minutes - quicker than expected - as investors raced to get their bids in.In fact, the auction closed within a few minutes - quicker than expected - as investors raced to get their bids in.
The Dutch State Treasury Agency has sold €1.995bn of bonds - bang in the middle of its target of €1.5bn to €2.5bn of debt.The Dutch State Treasury Agency has sold €1.995bn of bonds - bang in the middle of its target of €1.5bn to €2.5bn of debt.
This includes exactly €1bn of two-year bonds, at an average yield (the interst rate on the debt) of 0.523%. That's actually lower than the last auction of this type, according to Bloomberg.This includes exactly €1bn of two-year bonds, at an average yield (the interst rate on the debt) of 0.523%. That's actually lower than the last auction of this type, according to Bloomberg.
It also found buyers for €0.995 of 25-year bonds at an average yield of 2.782%.It also found buyers for €0.995 of 25-year bonds at an average yield of 2.782%.
The immediate reaction in the markets is positive -- Dutch sovereign debt strengthened slightly.The immediate reaction in the markets is positive -- Dutch sovereign debt strengthened slightly.
Mike van Dulken of Accendo Markets said the auction has passed "without fuss, despite government's weekend meltdown."Mike van Dulken of Accendo Markets said the auction has passed "without fuss, despite government's weekend meltdown."
Phew.Phew.
9.07am: While waiting for the Dutch debt auction results, there's an entertaining column in the Financial Times today by Kenneth Rogoff, Harvard University's professor of economics, in which he compares the eurozone to a young couple who set up with a joint bank account before getting married.9.07am: While waiting for the Dutch debt auction results, there's an entertaining column in the Financial Times today by Kenneth Rogoff, Harvard University's professor of economics, in which he compares the eurozone to a young couple who set up with a joint bank account before getting married.
The experiment goes well, so they each invite a sibling. Then the problems start...The experiment goes well, so they each invite a sibling. Then the problems start...
Eventually, the quartet decides that dinners will be even more fun, and the bank will give them an even better deal, if they expand the arrangement. So the siblings persuade a few cousins to join. Pretty soon, their phones are ringing off the hook with family members they have not seen in years. Cousin Kendra, a marginally employed chef with precarious finances, is nevertheless welcomed in hopes she will employ her culinary skills to enrich group meals.Eventually, the quartet decides that dinners will be even more fun, and the bank will give them an even better deal, if they expand the arrangement. So the siblings persuade a few cousins to join. Pretty soon, their phones are ringing off the hook with family members they have not seen in years. Cousin Kendra, a marginally employed chef with precarious finances, is nevertheless welcomed in hopes she will employ her culinary skills to enrich group meals.
My favourite line is about "first cousin Nigel", who irritates everyone by living "just across the river yet insists on managing his own finances" (yup, that's us, British readers).My favourite line is about "first cousin Nigel", who irritates everyone by living "just across the river yet insists on managing his own finances" (yup, that's us, British readers).
Worth a read (if the FT paywall allows you).Worth a read (if the FT paywall allows you).
8.52am: I must confess this is the first time that I've been eagerly awaiting the results of a Dutch debt auction since the eurozone crisis began.8.52am: I must confess this is the first time that I've been eagerly awaiting the results of a Dutch debt auction since the eurozone crisis began.
Reuters journalist Jamie McGeever agrees that it is unusual for the Dutch State Treasury Agency to be in the spotlight:Reuters journalist Jamie McGeever agrees that it is unusual for the Dutch State Treasury Agency to be in the spotlight:
netherlands sells up to €2.5 bln of bonds today. unprecedented attention on a dutch sale after govt collapse.netherlands sells up to €2.5 bln of bonds today. unprecedented attention on a dutch sale after govt collapse.
— Jamie McGeever (@ReutersJamie) April 24, 2012— Jamie McGeever (@ReutersJamie) April 24, 2012
The auction starts at 9am BST (10am Dutch time), with the results due within an hour. In the meantime, here's more analyst comment, this time from Investec's Brian Barry:The auction starts at 9am BST (10am Dutch time), with the results due within an hour. In the meantime, here's more analyst comment, this time from Investec's Brian Barry:
The auction will be a litmus test as to demand for their paper given the impending election... if there's a marked increase (in yields) then we'll know investors are getting a bit more worried.The auction will be a litmus test as to demand for their paper given the impending election... if there's a marked increase (in yields) then we'll know investors are getting a bit more worried.
8.32am: Economist Nouriel Roubini has claimed this morning that Europe's new fiscal rules are 'dead on arrival' even before they've come into effect. He tweeted this morning that yesterday's events (the political crisis in the Netherlands, and the results of the first round of the French presidential election) mean the rules are already unravelling:8.32am: Economist Nouriel Roubini has claimed this morning that Europe's new fiscal rules are 'dead on arrival' even before they've come into effect. He tweeted this morning that yesterday's events (the political crisis in the Netherlands, and the results of the first round of the French presidential election) mean the rules are already unravelling:
EZ Fiscal Compact DOA even before ratification. So much for credible/binding fiscal rules during a severe recession that make it more severeEZ Fiscal Compact DOA even before ratification. So much for credible/binding fiscal rules during a severe recession that make it more severe
— Nouriel Roubini (@Nouriel) April 24, 2012— Nouriel Roubini (@Nouriel) April 24, 2012
François Hollande, the socialist leader who won the first round of France's elections, blamed Europe's austerity drive for the popularity of the far-right National Front leader Marine Le Pen.François Hollande, the socialist leader who won the first round of France's elections, blamed Europe's austerity drive for the popularity of the far-right National Front leader Marine Le Pen.
Speaking in Brittany last night, Hollande said:Speaking in Brittany last night, Hollande said:
It's this austerity everywhere that brings desperation to people and leads them to vote for the far-right.It's this austerity everywhere that brings desperation to people and leads them to vote for the far-right.
8.20am: European stock markets have risen in early trading, but it's a muted recovery after yesterday's heavy losses (in which the German DAX lost over 3%, and the FTSE 100 nearly 2%). Here's the details:8.20am: European stock markets have risen in early trading, but it's a muted recovery after yesterday's heavy losses (in which the German DAX lost over 3%, and the FTSE 100 nearly 2%). Here's the details:
FTSE 100: up 19 points at 5685, + 0.35%
DAX: up 45 points at 6568, + 0.7%
French CAC: up 15 points at 3114, + 0.5%
Dutch AEX: up 1.34 points at 302. 61, + 0.44%		FTSE 100: up 19 points at 5685, + 0.35%
DAX: up 45 points at 6568, + 0.7%
French CAC: up 15 points at 3114, + 0.5%
Dutch AEX: up 1.34 points at 302. 61, + 0.44%
8.08am: City analysts predict that this morning's Dutch debt auction could show that investors are more nervous about lending to the Netherlands, following the government's collapse on Monday.8.08am: City analysts predict that this morning's Dutch debt auction could show that investors are more nervous about lending to the Netherlands, following the government's collapse on Monday.
Tthe auction of up to €2.5bn of two types of bonds (one maturing in 2014, the other in 2037), begins at 9am BST, with results expected before 10am.Tthe auction of up to €2.5bn of two types of bonds (one maturing in 2014, the other in 2037), begins at 9am BST, with results expected before 10am.
Michael Hewson of CMC Markets predicted that the Dutch authorities may have to agree higher borrowing costs than at previous auctions of this type of debt (am looking for old data on this now....)Michael Hewson of CMC Markets predicted that the Dutch authorities may have to agree higher borrowing costs than at previous auctions of this type of debt (am looking for old data on this now....)
While the two issues look likely to get away, the yield on the issuance could well be higher, given the sharp rise in yields seen yesterday. Yields shot up not only on Dutch bonds but on Spanish, Italian and French 10 year bonds as well.While the two issues look likely to get away, the yield on the issuance could well be higher, given the sharp rise in yields seen yesterday. Yields shot up not only on Dutch bonds but on Spanish, Italian and French 10 year bonds as well.
And Ransquawk, the financial news service, said:And Ransquawk, the financial news service, said:
Today's results could show a dent in demand following the resignation of the country's cabinet yesterday, bringing expectations of a new vote to be held in September, putting its prized triple-A rating in jeopardy and causing the spread between the Dutch 10yr and its German counterpart to widen 28.5% during yesterday's session.Today's results could show a dent in demand following the resignation of the country's cabinet yesterday, bringing expectations of a new vote to be held in September, putting its prized triple-A rating in jeopardy and causing the spread between the Dutch 10yr and its German counterpart to widen 28.5% during yesterday's session.
7.55am: The collapse of the Dutch government on Monday over its austerity budget puts the country's triple-A credit rating at risk.7.55am: The collapse of the Dutch government on Monday over its austerity budget puts the country's triple-A credit rating at risk.
Overnight, Moody's warned that the crisis was "credit negative", but said it was maintaining its current rating of AAA with a stable outlook. Overnight, Moody's warned that the crisis was "credit negative", but said it was maintaining its current rating of AAA with a stable outlook.
Here are some highlights from the Moody's statement:Here are some highlights from the Moody's statement:
This development is clearly credit-negative for the Dutch sovereign given that it generates both political and policy uncertainty....Having said that, the Netherlands is entering this testing period from a position of relative strength.This development is clearly credit-negative for the Dutch sovereign given that it generates both political and policy uncertainty....Having said that, the Netherlands is entering this testing period from a position of relative strength.
Moody's predicted political instability in the Netherlands for the rest of 2012, and also warned that the collapse of Mark Rutte's government also threatens Europe's drive for closer, tighter, fiscal unity:Moody's predicted political instability in the Netherlands for the rest of 2012, and also warned that the collapse of Mark Rutte's government also threatens Europe's drive for closer, tighter, fiscal unity:
As one of the euro area's main proponents of rules-based fiscal discipline and monitoring, a Dutch failure to abide by these rules could weaken proposed euro area rules at their birth.As one of the euro area's main proponents of rules-based fiscal discipline and monitoring, a Dutch failure to abide by these rules could weaken proposed euro area rules at their birth.
In other interesting credit rating agency news overnight, Standard & Poor's has cut its outlook on Argentina's B rating from stable to negative, following its controversial nationalisation of energy firm YPF. Here's the statementIn other interesting credit rating agency news overnight, Standard & Poor's has cut its outlook on Argentina's B rating from stable to negative, following its controversial nationalisation of energy firm YPF. Here's the statement
7.54am: Here's today's agenda:7.54am: Here's today's agenda:
• Dutch bond auction (up to €2.5bn of 2 and 25-year bonds): from 9am BST / 10am CEST
• UK public sector borrowing data for March: 9.30am BST
• Spanish bond auction (3+6 month bills): 9.40am BST / 10.40am CEST
• Italian debt auction: morning
• Mark Rutte addresses parliament in The Hague: 1pm BST / 2pm CEST		• Dutch bond auction (up to €2.5bn of 2 and 25-year bonds): from 9am BST / 10am CEST
• UK public sector borrowing data for March: 9.30am BST
• Spanish bond auction (3+6 month bills): 9.40am BST / 10.40am CEST
• Italian debt auction: morning
• Mark Rutte addresses parliament in The Hague: 1pm BST / 2pm CEST
Another interesting event today -- I believe the governor of the Bank of Greece is due to deliver his annual assessment of the Greek economy (just looking for more details on this now).Another interesting event today -- I believe the governor of the Bank of Greece is due to deliver his annual assessment of the Greek economy (just looking for more details on this now).
7.45am: Good morning, and welcome to today's rolling coverage of the eurozone financial crisis.7.45am: Good morning, and welcome to today's rolling coverage of the eurozone financial crisis.
The political crisis in the Netherlands continues today. Mark Rutte is due to address parliament in The Hague this afternoon, where politicians are wrestling with the question of how to agree a budget for 2013.The political crisis in the Netherlands continues today. Mark Rutte is due to address parliament in The Hague this afternoon, where politicians are wrestling with the question of how to agree a budget for 2013.
Rutte's dramatic resignation yesterday continues to dominate the agenda – although European stock markets are expected to post a small recovery after Monday's selloff.Rutte's dramatic resignation yesterday continues to dominate the agenda – although European stock markets are expected to post a small recovery after Monday's selloff.
The Dutch must also test the support of the financial markets this morning, with an auction of up to €2.5bn of debt (in two year and 25-year bonds). Spain and Italy are also selling government bonds today.The Dutch must also test the support of the financial markets this morning, with an auction of up to €2.5bn of debt (in two year and 25-year bonds). Spain and Italy are also selling government bonds today.
And in the UK, new borrowing figures will show whether George Osborne hit his deficit target for 2011.And in the UK, new borrowing figures will show whether George Osborne hit his deficit target for 2011.