In Spain today we have heard that Spanish Prime Minister Mariano Rajoy has begun addressing his parliament detailing new austerity measures in an effort to curtail the current economic issues that are being faced. The biggest news is likely to be an increase in VAT which is unlikely to be a popular decision in the country and could cause more public unrest which is the last thing the country needs. In return for the austerity measures Spain are to receive bailout funds for their banks of which €30bn is expected to be paid before the end of the month. Despite the austerity measures and the upcoming bailout of the banks the Spanish economy does appear to be following in Greece’s footsteps but due to the fact Spain is significantly larger than Greece the problems could have much larger and far reaching consequences. If you need to buy Euros we have breached the highest levels for 4 years meaning there are currently some excellent opportunities. Contact us today for more information.

Further bad news for Europe came yesterday when the International Labour Organisation (ILO) warned that a further 4.5 million jobs could be lost in the next 4 years due to the austerity measures. The ILO stated that the the EU should focus on job creation rather than cuts as with the current downturn in the economy more job losses will mean less money being earned and therefore spent which is unlikely to help create a recovery. If we see further job losses it is likely to weaken the EU economy and therefore Euro exchange rates but with unemployment high and rising in the UK the same could be said of Sterling exchange rates.

For the rest of the week there is not a lot of economic data due so any further news from Spain and Europe could create market movement, so if you need to transfer money abroad and are looking for great exchange rates make sure you speak to one of our experienced currency brokers at Foreign Currency Direct today so we can discuss your currency requirements and all the options available to you. You can call straight through to our dealing floor for free on 0800 328 5884 or email us on