Gareth Vaughan, sitting in for Bernard Hickey, details the key news overnight in 90 seconds at 9 am with Bank of New Zealand, including news that concerns are continuing to mount over Europe’s sovereign debt crisis with the spotlight on Ireland, Portugal and Greece overnight.
Speaking in Brussels European Union (EU) President Herman Van Rompuy said: “We’re in a survival crisis.”
Irish bond yields rose and the euro fell as Ireland negotiates with the EU and International Monetary Fund about aid to bolster its state finances and secure capital for its banks.
Against this backdrop the prospect that Portugal could also require an international bailout was raised as were concerns Spain could face speculative pressure.
And Austria’s Finance Minister said his government was considering withholding Austria’s share of the next slice of Greece’s 110 billion euro rescue package, because the Greek government had missed a revenue-raising target. This news hit Greek bonds pushing the extra yield over 10-year German bonds up by 12 basis points to 898 basis points.
German Chancellor Angela Merkel raised the possibility of the euro collapsing, warning: ''If the euro fails, then Europe fails.”
Meanwhile, in China Premier Wen Jiabao said the country’s cabinet was drawing up plans to counter inflation. China recorded 4.4% inflation in October and a report yesterday suggested the Government might impose price limits on food and introduce tougher punishment for people caught speculating on agriculture futures such as corn and cotton.
In the currency markets the New Zealand dollar fell to US76.60 cents from US 77.25c yesterday, its lowest level since November 1.
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