By James McKee
Spain’s newest attempts to fix their banking problems have resulted in the country being downgraded by Moody’s from an Aa2 rating to Aa1. This comes as no big surprise to many analysts who have seen Spain on the decline for some time now much like Greece or Italy. Spain is experiencing similar banking troubles to those seen in Ireland which is having a catastrophic impact on the country’s economy. This in turn has had a serious downturn effect on the Euro, bringing it from 1.3850 to 1.3820 in a matter of hours as news of Spain spread through the market.
The forex exchange has seen much instability where the Euro is concerned over recent months due to the EU’s nature of propping up the countries contained within it. Greece, Italy and Ireland have all had a staggeringly negative effect upon the EU as a whole, leading Germany to impose austerity measures upon countries that are being bailed out. This has created a gap between those countries in the EU that are doing well financially and those that are not. While no member of the EU is where they want to be there are certainly some winners and losers in the current situation.
Some have said that the EU needs to be dissolved in order for any European country to be able to enjoy long-term survival financially. If the EU does not begin taking careful steps to safeguard their economy now then the storms brewing on the horizon will certainly hit Europe and bring about serious turmoil. The USD and EUR are both going to be seeing some dark days ahead due not only to the necessary austerity measures being imposed but also the continuing crisis erupting in the Middle East which no one is certain will end any time soon.
About the Author
Author is a Forex trader and financial analyst residing in Denver, Colorado. To stay up to date on all the latest developments in the financial world and beyond be sure to check out the forex exchange rates regularly
