OFFICIAL Thread | Markets, Economic News

[anonymousfaarax]

THESE ARE THE MAIN POINTS FROM THE PROPOSED FISCAL EU AGREEMENT:

A) Rules:

1. [STRUCTURAL] DEFECIT SHALL REMAIN BELOW 3% OF GDP.

2. GOVERNMENT DEBT SHALL REMAIN ≤60% OF GDP.

B) The above rules shall be introduced by binding provisions in constitutional laws of countries. Automatic correction mechanisms shall be put in place by signatories so that if deviation from the rules occurs, corrective measures shall be put in place.

C) Countries shall report ex-ante to the European Commission (EC1) and the European council (EC2) any plans to issue debt.

D) Countries that would be breaking the balanced budget rule shall put in place structural adjustment programs (SAP’s). Such SAP’s shall be submitted to the EC1 and EC2.

E) Eurozone countries whose deficit is >3% shall undertake any proposals and recommendations put forward by the EC1 – unless a qualified majority of the Eurozone countries rejects these proposals and recommendations.

F) Any contracting party that deems another contracting party has failed to comply with B (above) may bring the matter before the ECJ. Judgement from ECJ shall be binding on the matter.

D) Heads of states of the Eurozone countries shall meet in a ‘euro summit’. The president of the ECB shall be invited to such a summit. The heads of states shall elect a ‘euro summit’ President by simple majority vote. This summit is to discuss issues regards the single currency, governance and rules of the Eurozone and strategic orientations for the conduct of economic policies, improved competitiveness and increased convergence.

E) Euro summit meetings shall be prepared by the president of the euro summit with close co-operation of the president of the EC1. Other member states of the E.U shall be closely informed of the preparation and outcome of euro summits.

[anonymousfaarax]

Fitch says comprehensive solution to eurozone crisis is 'beyond reach' - statement in full

Fitch placed six eurozone countries on downgrade watch on Friday, in a damning judgement of the crisis which saw the ratings agency declare that a comprehensive solution to the eurozone crisis is "beyond reach". Here is its statement in full.

Fitch Ratings has placed the ratings of all investment grade rated eurozone sovereigns and their debt with Negative Outlook onto Rating Watch Negative (RWN). The euro area country ceiling of 'AAA' is unaffected. The rating actions are as follows:

- Belgium 'AA+'/'RWN from 'AA+'/Negative Outlook ('F1+' Unaffected)

- Spain 'AA-'/'F1+'/RWN from 'AA-'/'F1+'/Negative Outlook

- Slovenia 'AA-'/'F1+'/RWN from 'AA-'/'F1+'/Negative Outlook

- Italy 'A+'/'F1'/RWN from 'A+'/'F1'/Negative Outlook

- Ireland 'BBB+'/'F2'/RWN from 'BBB+'/'F2'/Negative Outlook

- Cyprus 'BBB'/'F3'/RWN from 'BBB'/'F3'/Negative Outlook

The RWN indicates that the above ratings are under active review and are subject to a heightened probability of downgrade in the near-term. Fitch expects to complete the review by the end of January 2012. If the review concludes that a downgrade is warranted, it is likely be limited to one or two notches.

Following the EU Summit on 9-10 December, Fitch has concluded that a 'comprehensive solution' to the eurozone crisis is technically and politically beyond reach.

http://www.telegraph.co.uk/finance/fina ... -full.html

[anonymousfaarax]

Fitch downgrades seven banking giants

Fitch has downgraded its ratings of seven of the world's largest banks, citing challenging financial markets.

Bank of America, Goldman Sachs, BNP Paribas, Barclays, Deutsche Bank and Credit Suisse were cut. In a separate announcement, Fitch also cut Citigroup.

Fitch cut the "issuer default ratings" (IDR) at the banks, which "reflect the ability of an entity to meet financial commitments on a timely basis".

Banks and credit markets have been hurt by fears over the eurozone debt crisis.

Several nations in the 17-nation single currency bloc have been bailed out amid fears that the euro could collapse.

Banks that hold eurozone sovereign debt have taken massive charges on the debt, and it has increased fears about banks lending to each other.

Last week, ratings agency Moody's downgraded France's three big banks due to their difficulty borrowing money.

Fitch said the US and European banks "are particularly sensitive to the increased challenges the financial markets face".

Fitch also cut the so-called "viability ratings" of Morgan Stanley and Societe Generale, which represent the agency's view as to the "intrinsic creditworthiness of an issuer".

On 30 November, Standard & Poor's downgraded the long-term credit grades of a string of major financial firms, including Bank of America and Goldman Sachs, Barclays, and HSBC.

http://www.bbc.co.uk/news/business-16210134