Portugal failing, what about Spain?

Portugal’s admission that it will probably need a financial bailout raises a question that will shape the outcome of the euro zone’s debt crisis: Is Spain next?

Spanish Cajas may attract international investors

The government will unveil Thursday how much capital the savings banks, known as  cajas,  must raise under strict new minimum-capitalization requirements introduced earlier this year. The government hopes that a cleanup of the  cajas  — many heavily exposed to the housing bust in Spain — will help repair its battered reputation among international investors.

Spanish economy in recovery?

Spain’s economy pursued a “slow recovery” in early 2011, the Bank of Spain said Friday, after joining crisis-torn Greece and Ireland as the only eurozone economies to shrink in 2010.

Spain is fending off fears in international financial markets that its public deficit is unsustainably high and could prompt the country to follow Greece and Ireland into seeking an EU-IMF bailout.

Dollar continues downwards trajectory as risk remains prevalent

• GBP remains stable as rate rises become more likely

• EUR continues to re establish itself but will the run continue

• China reduces its US Treasury holdings for second month

Governor says interest rates are going up

• Well, not exactly, but that’s what he meant

• Isn’t it?

Good morning. Here’s a little test to get the grey matter working on a chilly Wednesday morning. Find the words “one and a half per cent” in the following sentence, extracted from Bank of England governor Mervyn King’s letter to the chancellor yesterday:

UK rate decision today

• No change to 0.5% Bank Rate expected

• But you never know…

Good morning. Twenty general practitioners in Surrey are testing a system that uses a call centre to handle appointment requests. Perhaps such an arrangement could allow the government to sidestep the controversial European court ruling that gives convicts the vote, rather than going head-to-head against Strasbourg and risking an open-ended litigation bill.  The prime minister could comply by giving prisoners the vote but requiring them to cast it through a call centre. “If you would like a list of all the candidates who support capital punishment press one; if you are only serving time for something trivial like aggravated assault press two; if you were fitted up or it was all a big mistake press three; if you are trying to make a doctor’s appointment press one-one-one; to return to the previous menu press nine.”

Sterling the winner on a 2-6-1 formation

• US dollar still out of favour

• Has the market forgiven sterling already?

Spanish yields fall at debt tender but markets remain skeptical

Yields fell sharply at the Spanish Treasury’s bill tenders on Tuesday just a day after the government announced tougher capital adequacy ratios for the country’s banks and warned that those failing to meet them faced nationalization. But banking stocks were hit by the move and Spain’s risk premium widened as investors continued to question whether the plan to strengthen the financial sector went far enough.

Inflation in Spain last month hits highest two-year level

Inflation in Spain hit its highest level in over two years in December, eroding the purchasing power of consumers at a time when the economy is still trying to return to the path of growth after its worst recession in over half a century.

Spain Faces Second Front on Regional Debt

Prime Minister Jose Luis Rodriguez Zapatero may face a second front in his battle to contain Spain’s fiscal crisis as borrowing costs for the country’s regional governments climb.