Wednesday, 22 June 2011

IMF Warns of ‘Considerable’ Risks in Spain as Debt Crisis Threatens Growth

http://www.bloomberg.com/news/2011-06-21/imf-sees-considerable-risks-to-spain-economy-urges-additional-overhauls.html

“Financial conditions could deteriorate further, reflecting rising concerns about sovereign risks in the euro area,” the IMF said. “This could put additional pressure on sovereign and bank funding costs for Spain, which in turn could feed back to the real economy.”

SS says

This is a warning sign.

I am sure we will see Spain go for bail out money.
This will happen within the next 3 - 5 years if not before.

“Some of the underlying problems of the Spanish economy, especially weak productivity growth and the dysfunctional labor market, remain to be fully addressed,” the IMF said. It called for “further enhancing the credibility of fiscal consolidation, completing financial-sector reform” and “boldly strengthening the reforms of the labor market.”


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