Investors' impatience with the lack of progress on a permanent solution to the Euroland debt crisis (if that's what it still is) has begun to take its toll. From its position at the beginning of October the euro has fallen by more than two US cents. The euro has actually strengthened by a quarter of a cent against the pound over the same period but that bald statistic hides a fall of more than three cents for sterling during the first three weeks of October and a three-cent rally since then.
The position of Spain has not really moved on. The general belief that it should apply for a bailout, triggering the European Central Bank support programme for its government bonds, is not shared by Prime Minister Rajoy. He sees no need to hurry because the mere threat of ECB action has already reduced his borrowing costs.
He can also see the damage that additional austerity measures - a likely condition of bailout support - could do to his country. The economy of Greece has shrunk by a quarter since 2009 and another two years of recession lie ahead. EU leaders are trying to keep Greece in the single currency but at a terrible cost to the country. It might also be at a terrible cost to EU governments if an eventual shortage of cash in Greece means it has to default on its obligations to them.
The worries about Greece and Spain (and, most recently, France) have now been joined by concern about the euro area economy. Germany has begun to feel the pinch and has recently reported declines in manufacturing orders and output, retail sales and business sentiment. Purchasing managers' index readings for the manufacturing and services sectors both indicate contraction. Euroland's economy could be in recession until the end of next year.
The latest unhelpful development is a reported spat between the International Monetary Fund and the EU about an easing of the terms of Greece's bailout. No wonder investors are finding it more difficult to be optimistic about the euro than they were a month ago.
The position of Spain has not really moved on. The general belief that it should apply for a bailout, triggering the European Central Bank support programme for its government bonds, is not shared by Prime Minister Rajoy. He sees no need to hurry because the mere threat of ECB action has already reduced his borrowing costs.
He can also see the damage that additional austerity measures - a likely condition of bailout support - could do to his country. The economy of Greece has shrunk by a quarter since 2009 and another two years of recession lie ahead. EU leaders are trying to keep Greece in the single currency but at a terrible cost to the country. It might also be at a terrible cost to EU governments if an eventual shortage of cash in Greece means it has to default on its obligations to them.
The worries about Greece and Spain (and, most recently, France) have now been joined by concern about the euro area economy. Germany has begun to feel the pinch and has recently reported declines in manufacturing orders and output, retail sales and business sentiment. Purchasing managers' index readings for the manufacturing and services sectors both indicate contraction. Euroland's economy could be in recession until the end of next year.
The latest unhelpful development is a reported spat between the International Monetary Fund and the EU about an easing of the terms of Greece's bailout. No wonder investors are finding it more difficult to be optimistic about the euro than they were a month ago.
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