Klaus Regling, the managing director of the euro zone’s permanent bailout fund ESM, doesn’t expect Spain, nor other countries, to be needing more financial aid, he told Expansion in an interview published on its Wednesday Internet edition.
Source: Fox Business Headlines
Tag Archives: Spain
First Images of 2014 Mercedes-Benz E-class Leak Ahead of Debut

The 2014 Mercedes-Benz E-class’s element of surprise finally has been completely blown. After the E-class was caught completely undisguised in Spain, Mercedes itself posted teaser photos of the E’s new headlight design and let us take a spin in the 2014 E63 AMG sedan. Now, images of the refreshed E-class have spilt onto the internet. Differences between the new luxury sedan and the outgoing car aren’t huge—the current car’s odd Ponton rear fender crease and dual headlight pods are gone in favor of smooth flanks and single-pod headlight units stuffed with LED accents. But altogether the changes furnish a more attractive, sleeker-looking E-class that eschews the outgoing car’s somewhat disjointed appearance. We’ll have full details on the new Benz later this week, so be sure to check back here for your weekly fix of German product news.
Comparison Test: 2013 Audi S6 vs. 2013 BMW M5, 2012 Mercedes-Benz E63 AMG
Instrumented Test: 2012 Mercedes-Benz E63 AMG Wagon
Instrumented Test: 2012 Mercedes-Benz E550 4MATIC Sedan

Source: Car & Driver
Spain raises $5 billion in healthy bond sale
Spain has raised an above-target €3.9 billion ($5 billion) in a successful debt auction that saw interest rates drop sharply despite renewed concern about whether the country needs international help. The Treasury said Tuesady that it sold €2.39 billion in in 12-month bills with a yield of 2.56 percent, down from 2.79 percent in the previous auction on Nov. 20. It sold €1.5 billion in 18-month bills at an average rate of 2.79 percent, down from 3.03 percent. The Treasury had set a maximum sale target of €3.5 billion, and demand was double the amount offered. Spain came under renewed pressure to seek help Monday as its secondary market borrowing costs — a measure of investor wariness — rose after Italian Premier Mario Monti‘s decision to resign caused market jitters.
Source: Fox World News
Spain’s Iberia unions cancel pre-Christmas strikes
Labor unions representing a majority of workers in Spain‘s Iberia airline have called off six days of strikes they had planned to stage before the Christmas holiday period to protest the company’s plan to lay off 4,500 workers. The General Workers Union, Spain‘s largest, said Tuesday the unions cancelled the stoppages so as not to upset travelers even though they had yet to reach an agreement with the company over the layoffs. The unions are to meet to decide on new protest action. The stoppages by ground staff and cabin crews were to be held Dec. 14 and Dec. 17-21. International Airlines Group, which groups together British Airways and Iberia, plans to cut 23 percent of the Spanish company’s staff, saying it is fighting for survival.
Source: Fox World News
Spain says Italian political uncertainty weighs
Spain will suffer a contagion effect from Italy‘s new political turmoil and the government continues to study the need for outside assistance, Spanish Economy Minister Luis de Guindos said on Monday.
Source: Fox Business Headlines
Spain’s bond rate up on uncertainty in Italy
Italian Premier Mario Monti’s announcement that he plans to resign has sent the interest rate for Spain‘s benchmark 10-year bond climbing again. The rate, an indication of investor appetite, rose 0.19 percentage points to 5.84 percent in opening trading Monday. It later edged back to 5.59 percent. The yield had dropped to 5.3 percent last week. The main IBEX stock index in Madrid was down 2 percent. Spain and Italy are two countries at the center of the European debt crisis. Recession-hit Spain‘s borrowing costs rose to unsustainable highs of 7 percent earlier this year but have eased greatly since the European Central Bank pledged in September to buy up a country’s short-term bonds if it formally applies for aid.
Source: Fox World News
Report: Barclays to Invest in Spain’s ‘Bad Bank’
The British bank will reportedly invest in SAREB, Spain‘s ‘bad bank,’ in a sign that it is committed to helping fix Spain‘s banking troubles.
Source: Fox Business Headlines
ECB holds rates, may be done with euro stimulus
The European Central Bank left its key interest rate unchanged at a record low Thursday, holding off on further stimulus even as the economy across the 17 European Union limps through a recession. The bank’s 22-member governing council kept the refinancing rate unchanged at 0.75 percent. The rate determines what private-sector banks are charged for borrowing from the ECB, and through that what rate the banks set for their businesses and consumer clients. Markets are now waiting for a news conference by President Mario Draghi, who is expected to announce the bank is cutting its growth forecast for next year. A rate reduction in theory could stimulate the eurozone’s economy by making it easier to borrow, spend and invest. But rates are already low, and borrowing remains weak. There are only a few early signs that previous rate cuts and stimulus measures are finally trickling through to the wider economy. The eurozone economy shrank 0.1 percent in the third quarter and is expected to fall further in the last three months of the year. Market analysts expect the ECB to cut its growth forecast for next year to around zero from 0.5 percent in September, bringing its outlook in line with 0.1 percent predicted by the European Union‘s executive arm, the Commission. Growth is suffering as governments slash spending and raise taxes to try to reduce levels of debt piled up from overspending in the case of Greece or real estate bubbles and banking crises in Spain and Ireland. Greece, Portugal, Ireland and tiny Cyprus have already requested bailouts, while Italy and Spain, the eurozone’s third- and fourth-largest economies, teetered on the edge of needing help this summer. Some analysts think the bank may now consider it has done enough to help the economy after a year of drastic measures. The most important was an offer to buy unlimited amounts of bonds issued by of Europe‘s heavily indebted countries. It also made €1 trillion ($1.3 trillion) in cheap, long-term loans to stabilize shaky banks last December and February, and cut rates a quarter point in July. The bond purchase plan announced in September has helped stabilize the eurozone debt crisis. The purchases would aim to drive down bond interest rates, which would lower borrowing costs for indebted countries such as Spain and Italy and make it easier for them to carry their debt loads. Although no bonds have been bought, the mere possibility has influenced the bond market and for now pushed borrowing costs back to sustainable levels for those two countries. The interest yield on Spanish 10-year bonds is at around 5.4 percent now, down from 7.6 percent in July. Italy‘s costs to borrow for 10 years are now down to 4.4 percent, down from over 7 percent at the start of the year and close to the country’s average for the past decade. But while governments are breathing easier, that hasn’t restarted growth. Bank officials and analysts have questioned how much good further measures such as rate cuts would do. The problem is that the stimulus from earlier rate cuts and the flood of cheap loans to banks did not make it through to the economy in the form of more borrowing and activity. Businesses were reluctant to take on the risk of more borrowing. And in the troubled countries, borrowing costs for businesses remained high despite low ECB rates. This is because those countries’ struggling banks were still working off losses from the past five years of global financial and economic turmoil. The ECB has tried to make sure that its crisis efforts are making it through to the eurozone’s wider economy — but it is taking time to be felt and fear and reluctance remain. While some business confidence indicators are beginning to rise and the supply of money in the economy is increasing, consumer spending sagged 1.2 percent in October.
Source: Fox World News
ECB could be done helping eurozone economy
The European Central Bank is unlikely to offer any further help for Europe‘s sagging economy Thursday after already lowering interest rates to record lows and calming the region’s debt crisis with its plan to buy the bonds of heavily indebted governments. After a year that has seen €1 trillion ($1.3 trillion) in emergency loans to banks, a rate cut, and President Mario Draghi‘s vow to “do whatever it takes” to rescue the euro, some analysts say the ECB may consider itself finished with efforts to rescue the economy of the 17 European Union countries that use the euro. Analysts say the bank will hold off cutting its key refinancing rate any further from its current 0.75 percent when the bank’s 22-member governing council gathers at its headquarters in Frankfurt. The council sets monetary policy for the eurozone and its 333 million people. It is also unlikely that the ECB will offer any major new emergency measures, after Draghi made the risky but crucial step in September of saying the bank could buy unlimited amounts of government bonds and lower borrowing costs for those governments, such as Spain and Italy, that are struggling to finance their debts. Eurozone financial markets have calmed since ECB made its offer, though it has yet to buy a single bond under it. The ECB would only do so if a country asks for the help and agrees to take steps to reduce its deficit. Even so, the bond offer and calmer markets have so far removed the threat of a government might be forced to default on its debts. But it will take more than that to get the wider economy moving again. The eurozone shrank 0.1 percent in the third quarter, and is likely to shrink again in the last three months of the year. Meanwhile, the ECB is expected to cut its forecast for next year from 0.5 percent to near zero, in line with the forecast for 0.1 percent growth from the EU‘s executive commission. Cutting rates can stimulate lagging growth by lowering borrowing costs, thereby making it easier for businesses to expand and consumers to spend. But bank officials have questioned how much good further cuts would do. Even with record low rates, businesses still aren’t borrowing much due to the weak outlook. Eurozone retail sales slumped 1.2 percent in October, far more than expected. Low rates and an infusion of around €1 trillion in low-cost loans to banks last December and February are only now showing faint signs of trickling through to the wider economy. The slack economy, along with lower oil prices, has helped lower inflation to 2.2 percent, closer to the bank’s goal of just under 2 percent. Yet even that won’t be enough to trigger a cut with rates this low. Recent statements by Draghi and other council members indicate “that the ECB perceives its job, both on conventional and unconventional policy, as just about done,” said Marco Valli, chief eurozone economist at Unicredit. He sees no rate cut “for the foreseeable future.” Christian Schulz, senior economist at Berenberg Bank, says that as long as the economy shows even a mild recovery by next spring, “the ECB will not cut interest rates further” and could even be the first major Western central bank to start raising them in late 2013. Not everyone agrees. Analysts at Nomura and IHS Global Insight see a chance for a cut in the first part of next year and don’t completely rule out a surprise move Thursday. Howard Archer at IHS says low inflation and slack growth mean that the ECB “has ample justification and scope to take interest rates from 0.75 to 0.50 percent sooner rather than later.” The ECB stance contrasts with that of the U.S. Federal Reserve, which is adding support for the US economy by carrying out open-ended purchases of government bonds until unemployment falls. The purchases keep longer-term interest rates down. The U.S. economy is growing, unlike Europe, but could face trouble from the so-called “fiscal cliff” — automatic spending cuts and tax increase that would result if Congress and President Obama fail to make a budget deal. The Fed next meets Dec. 11-12.
Source: Fox World News
Spain bond sale falls short of top-end target
Spain fell short of its targeted amount at a triple bond auction on Wednesday, prompting a rise in yields on the secondary market as investors await the government‘s move to trigger European Central Bank bond-buying.
Source: Fox Business Headlines
Spain pays mostly lower rates in debt sales
Spain has raised €4.2 billion ($5.5 billion) in debt auctions at mostly lower interest rates, indicating improving investor confidence as the government ponders tapping a European financial facility that could ease its high borrowing costs. The Treasury sold €1.12 billion in benchmark 10-year bonds Wednesday at an average interest rate of 5.29 percent, down from 5.46 percent in the last such auction Oct. 18. It paid 3.39 percent, down from 3.62 percent, to sell €2.12 billion in three-year bonds. The department sold €1 billion in bonds maturing in 2019, but at a yield of 4.67 percent, up from 4.54 percent. Demand averaged twice the amount offered. Recession-hit Spain says it must know all the conditions before requesting an international aid program for its public finances.
Source: Fox World News
Class of 2012: Young Europeans trapped by language
Maria Menendez, a 25-year-old caught in Spain‘s job-destroying economic crisis, would love to work in Germany as a veterinarian. Germany, facing an acute shortage of skilled workers, would love to have her. A perfect match, it seems, but something’s holding her back: She doesn’t speak German. The European Union was built on a grand vision of free labor markets in which talent could be matched with demand in a seamless and efficient manner, much in the way workers in the U.S. hop across states in search of opportunity. But today only 3 percent of working age EU citizens live in a different EU country, research shows. As young people in crisis-hit southern Europe face unemployment rates hovering at 50 percent, many find themselves caught in a language trap, unable to communicate in the powerhouse economy that needs their skills the most: Germany. “I think going abroad is my best option,” said Menendez, “but for people like me who have never studied German, it would be like starting from zero.” ___ Editors: This is the latest installment in Class of 2012, an exploration of Europe‘s financial crisis through the eyes of young people emerging from the cocoon of student life into the worst downturn the continent has seen since the end of World War II. Follow the class on its new Google plus page: http://apne.ws/ClassOf2012 ___ In northern Europe, companies are desperately seeking to plug labor gaps caused by low birth rates and the growing need for specialized skills amid still robust economies. Germany alone requires tens of thousands of engineers, IT-specialists, nurses and doctors to keep its economy thriving in the years to come. But a recent study pinpointed language as the single biggest barrier to cross-border mobility in Europe. “What seems to prevent further labor market integration in Europe is the fact that we speak different languages,” said Nicola Fuchs-Schuendeln, a Frankfurt University economics professor who co-authored the study. Few German employers are prepared to compromise when it comes to language skills, according to Raimund Becker, who heads the German Federal Employment Agency‘s division for foreign and specialist recruitment. “If you want to work as an engineer you’ll need a certain specialist vocabulary,” he said. “Even colloquial German isn’t enough.” Earlier this year the agency announced it would invest up to €40 million ($51 million) in special programs to help jobless Europeans aged 18 and 35 learn German so they can pursue jobs or training in Germany. The measure targets people like Menendez, who graduated from veterinary school and has two master’s degrees but hasn’t been able to find work in Spain. The market for veterinarians in her home country has taken a phenomenal beating over the past four years. Veterinary clinics are cutting back severely because crisis-hit Spaniards are spending less on pets, and a recent hike in the sales tax to 21 percent is hurting these businesses even more. “They’re just not hiring,” Menendez said. She would also be qualified to work as a veterinarian for an agricultural company, and she has sent about 1,000 resumes to all corners of Spain over the last year. But only two companies called her back for a preliminary interview. Neither called to invite her for a formal one. Menendez said she found plenty of jobs online in Germany, where EU rules mean her Spanish qualification would be accepted. But the ads are either in German or, if in English, say that candidates must have good German. Like most Spaniards, she studied English at school and is now focusing on improving her English. Often touted as the continent’s ‘lingua franca,’ English is widely used in multi-national companies but rarely in the public sector or the small-to-medium sized enterprises that employ the bulk of the European labor force. Meanwhile, London isn’t the magnet for young English-speaking Europeans that it used to be. Migrants who flocked there a decade ago are now returning home or looking elsewhere for work as Britain, too, struggles with a rising jobless rate. Ricardo de Campano learned the hard way how critical it is to have a wide set of language skills when he left London for Berlin two years ago. The 34-year-old said he quickly found work as a special needs teacher in London with the English he’d learned at school, but the same wasn’t true when he came to Germany. “If you want to have a decent job and be part of the system, pay your taxes and have your health insurance, you need to have German,” said De Campano, who is now studying the language of Goethe at an adult education college where Spaniards have come to make up the biggest single group of students in recent years. But despite the boom in German language teaching seen also in Spain itself, the number of Spaniards coming to Germany remains modest. According to figures provided by the Federal Employment Agency, less than 5,000 Spaniards have taken up jobs in Germany over the past year — a tiny fraction of the 4.7 million jobless in Spain. Class of 2012 participant Rafael Gonzalez del Castillo speaks German and could work in Germany. He picked up the language on a student exchange program in the southern town of Darmstadt and lived with German flat-mates in Madrid. But, in perhaps an alarming sign for Europe, he sees more opportunity and cultural affinity in booming Latin America — and has started to learn Portuguese so he can see work in Brazil. It’s part of a rising trend in Spaniards departing for former European colonies in Latin America, meaning that Europe is losing much of its top-level talent to emerging economies. “I see Brazil as a country that’s going to grow so much in these years,” said Gonzalez del Castillo, “And I feel close to them because we are Latin people, and our language is similar.” His fellow architect, 25-year-old David Garcia, is doing his masters in architecture in Spain after spending a year at the university in Regensburg, Germany. While there, Garcia took German lessons outside of his normal studies for the entire period. Now, Garcia is working for a German company remotely while in Spain, and plans to return there when he finishes — but none of his classmates have targeted Germany for work even though there are plenty of building opportunities there. “All the people I am studying with want to go abroad, but they prefer to go to England or South America because it will take them a lot of time for them to learn German,” Garcia said. Meanwhile, there are indications that workers from outside the EU are more willing to learn a new language than those from members of the bloc itself. The Organization for Economic Cooperation and Development said in its 2012 report that while only 3 percent of working-age EU citizens live in a fellow EU country, migrants from outside the EU make up 5 percent of the EU working-age population. And when Germany‘s economy minister recently launched a program to recruit skilled foreign workers, he turned not to southern Europe‘s vast pool of jobless workers but to India, Indonesia and Vietnam. Ten years ago European leaders at a meeting in the Spanish city of Barcelona called for “action to improve the mastery of basic skills, in particular by teaching at least two foreign languages from a very early age.” Six years later, the EU‘s language czar, Leonard Orban, declared that speaking two foreign languages in addition to their mother tongue should be the goal for all citizens of the 27-nation bloc. The result has been a deluge of programs to subsidize language learning in Europe. Yet a poll of more than 25,000 Europeans earlier this year still found only 54 percent said they were able to hold a conversation in more than one language. And with austerity eating into European government budgets, the bloc’s flagship student exchange program Erasmus, which supports 250,000 students and teachers with grants each year, faces a funding crisis. “We’ve had bills for over €100 million already which we can’t honor because there’s no money in the pot,” said Dennis Abbott, a spokesman for the European Commission’s education and multi-lingualism directorate. The shortfall represents less than 0.1 percent of the EU‘s annual budget, but the failure to break down language barriers could end up being far costlier. Edoardo Campanella, a former economic adviser to the Italian government, says labor mobility is fundamental to the EU‘s common market, and in particular the eurozone, where countries with widely differing economic fortunes share a single currency. “Labor mobility is an important adjustment mechanism,” said Campanella, currently a Fulbright Scholar at the Harvard Kennedy School. “The language hurdle impairs this safe-valve.” At Berlin’s Cafe Colectivo, 30-year-old project manager Maria Sarricolea from Spain laughed as she recalled friends asking about the job prospects in Germany. “A lot of Spanish people think they can come here and get a great job with a bit of English,” she said. ____ Clendenning contributed from Madrid. Barry Hatton in Lisbon contributed to this report. Frank Jordans can be reached at http://www.twitter.com/wirereporter ___ Follow The Class of 2012 on its new Google plus page: http://apne.ws/ClassOf2012 ___ Follow The Class of 2012 on the AP Big Story page: http://bigstory.ap.org/topic/class-2012 ___ Follow The Class of 2012 on Twitter: https://twitter.com/AP/class-of-2012
Source: Fox World News