June 22, 2009

Looking at the markets this morning the euro has started on the back foot. The reason for the fall in the euro is due to banking fears again creeping into the scene. The European Central Bank has warned that the region may face another 283 billion euros of losses by the end of next year and it seems that the skeletons are still appearing for Europe's basnking sector.

Further writedowns are likely to appear in most major economies, however the scale of the losses in the Eurozone is likely to weigh on the euro going forward. An article in the Wall Street Journal also highlighted the plight facing the German economy stating that "weaker tax revenue, soaring welfare bills and new spending for bank bailouts and fiscal-stimulus measures could increase Germany's debt by more than 100bn euros next year".

Report by Phil McHugh

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