This is going to end badly for the world. I do not believe that Asia will escape, it may suffer less but will suffer nevertheless.
By Emily Fox for www.express.co.uk
FEARS of contagion in Europe intensified today as the debt crisis spread to Spain. Spain was forced to pay nearly 7 per cent to borrow 3.56 billion euros (£3billion) on bond markets. Italian and French borrowing costs also rose as investors feared the countries may default on their debt repayments amid fears the eurozone is on the brink of recession.
Italian borrowing costs have remained above 7per cent, with new leader Mario Monti expected to unveil his government’s anti-crisis strategy in Parliament later today. Chris Beauchamp, market analyst at IG Index, said: “Italian benchmark yields are back in the bailout zone, above 7 per cent, despite the installation of a cabinet of technocrat experts in Rome, while Spanish yields are heading merrily towards the same abyss.
“Even more worrying was the continuing rise in French bond yields, and while these might be nowhere near the danger zone, it reminds everyone that the next eurozone domino after Italy and Spain is France.”
The rise in borrowing costs for Spain and Italy are creating panic because the countries are seen as too big to bail-out and could crash the eurozone.