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Spain will further savings this year and next if it is to achieve its ambitious goals of deficit reduction, since it will be in recession in 2012 and 2013 , according to European Commission forecasts released Friday.

The EC wrote in its economic prospects of the European Union biannual, that Spain should show a budget deficit of 6.4% of gross domestic product (GDP) in 2012 and 6.3% in 2013, unless you change the policies.

Madrid intends to reduce the deficit to 5.3% of GDP this year, against 8.5% in 2011 and, unless the finance ministers of the EU grant him more time to 3% in 2013, to save financial penalties. 

Even though the objective of the central government seems at hand, differences are expected at this stage for regional governments, the Commission explains in its report.

She added that the Spanish social security system is likely to remain in deficit this year due to the deteriorating outlook for the labor market.

The EU executive has revised sharply lower its forecast for GDP growth Spanish, now anticipating a 1.8% contraction in 2012, instead of 1.0% pre ; seen in February.

For 2012, the EC is planning a further contraction of economic activity, 0.3%, while the Spanish government is 0.2% growth. 

GROWTH FOR THE EURO AREA IN 2013

The EC believes that Spain will be the only country in the euro area to suffer a recession in 2013. She plans for the euro area as a whole increased by 1% next year, after contracting 0.3% this year.

"The recovery is in sight but the economic situation remains fragile, with still large disparities between Member States", said in a statement the European Commissioner for Economic and Monetary Affairs, Olli Rehn.

The combined fiscal deficit of the euro area would decrease to 3.2% of GDP in 2012, after 4.1% in 2011, and 2.9% in 2013.

"We're seeing an adjustment of fiscal and structural imbalances created before and after the crisis began and worsened by economic sentiment remains weak," says Rehn.

"Without new decisions energetic, low growth could persist in the EU. Sound public finances are a prerequisite for sustainable growth and, from an economic governance framework and strong again, we need to support the adjustment by accelerating the stability-oriented policies , and stimulation of growth "

. STAGNATION IN GREECE IN 2013

…… Regarding .. Greece, countries that initiated the crisis of sovereign debt in the euro area and now depends on funding from the EU and the International Monetary Fund, the EC expects zero growth in 2013, after contracting 4.7% in 2012, the fifth year of recession

. The budget deficit would fall to 7.3% of GDP in 2012 after 9.1% in 2011 but, unless Greece takes further steps to further reduce the die ; deficit, it goes back to 8.4% next year. 

Portugal, which, like Greece, depends on the help of international donors, will be close to meeting its deficit targets this year and next, with a deficit of 4.7% in 2012 and 3.1% in 2013.

The Portuguese economy would suffer a contraction of 3.3% in 2012, after contracting 1.6% in 2011, then record a growth of 0.3% in 2013.

Ireland, the third countries in the euro area to take advantage of the coupled EU-IMF to grow by 0.5% in 2012, after 0.7% in 2011, and 1.9% in 2013. Its budget deficit would be reduced to 8.3% of GDP this year, after 13.1% in 2011, and 7.5% in 2013.

The Spanish economy, sick man of Europe, is facing a "crisis of immense proportions", a minister said Friday, while the unemployment rate reached its highest level in twenty years and that Standard & Poor's lowered the rating by two notches of the sovereign debt.

The Spanish unemployment rate, one of the highest in the world, jumped to 24% in the first quarter, its highest level since the early 1990s. Retail sales fell for their part, for the 21st consecutive month, as the country is experiencing its second recession in three years.

"The numbers are terrible for everyone and terrible for the government (…) Spain is in a crisis of immense proportions," said the Foreign Minister, Jose Manuel Garcia -Margallo, during a radio interview.

The unemployment rate in Spain was 22.9% in the last quarter of 2011. Half of young people are unemployed and the numbers are unlikely to improve anytime soon, while fiscal savings of some 42 billion euros this year while undermining hope for growth for the country.

Standard & Poor's lowered the rating Thursday of the Spanish sovereign debt to "A" to "BBB +" with negative implications, citing the risk of fiscal slippages may be more important than expected.

The rating agency considers particularly likely that Madrid has to provide support to its banking sector.

Lowering S & P sovereign rating instead of Spain at the same level as that of Italy, to "adequate capacity to pay" – is a few notches away from the class speculative. From Fitch and Moody's, Spain has however always a "strong capacity to pay".

BANKS SICK

Friday morning at the Madrid Stock Exchange, banking stocks fell 3.38% while the risk premium of Spanish debt, measured by the yield spread between government bonds ; ten years, has jumped 10 basis points to 434 points.

"This is a very difficult situation. I do not think banks are trapped, but we need the government to quickly find out how they intend to do it for them, "said Gilles Moec, economist for Deutsche Bank ..

……. Spanish banks may require more public funds, said in the morning, the Secretary of State for Fernando Jimenez Latorre economy, while excluding the use of EU funds

. The Spanish government also plans to create a structure defeasance for banks' toxic real estate assets, three rounds of cleaning and consolidation of the country's financial sector was not enough to reassure investors of its soundness. 

Madrid has already come to the aid of several banks devastated by the bursting of the housing bubble in 2008 and investors feared, given the current economic contraction, a new wave of de defects credit which further weaken the country's financial sector.

The contraction of the economy also means that Spain is unlikely to achieve its fiscal targets this year despite a severe austerity.

While in Europe are increasing calls for measures to support growth, the Spanish Prime Minister Mariano Rajoy reiterated its willingness to adhere to fiscal consolidation planned for the country. 

His government expects that the reforms of labor market flexibility adopted in the first quarter produce results next year. For now, many companies have primarily benefited the new rules to lay off more.

GDF Suez reported Monday performance increased in the first quarter thanks to Britain's International Power, and confirmed its annual targets.

The energy company reiterated in a statement that the minority buy International Power (IP), he hopes to complete in mid-July, it would raise its objective of recurring net income group share for 2012 to a level between 3.7 and 4.2 billion euros – against a range of 3.5 to 4000000000 referred before.

GDF Suez also confirmed it expects for 2012 a gross operating profit (EBITDA) of approximately 17 billion euros and gross investment of 11 billion out minority shareholders IP, as well as an ordinary dividend stable or increasing compared to 2011. 

Its sales reached 28.2 billion euros at end-March, up 10.5% (8.4% organically), while its EBITDA was $ 5.8 billion, up 5.7% (4.1% organically).

The group noted that its EBITDA benefited from higher earnings of branches Energy International – which includes the assets of International Power – Energy and Europe, as well as strong earnings growth of the Global Gas & LNG, including through the exploration and production activities.

By activity, sales totaled 4.169 million euros for International Power in the first quarter (14.4%), 1.327 million for Global Gas & LNG (69.8%) and 14,559,000 for the Energy Europe ( 8.3%). 

Net debt of GDF Suez totaled 37.1 billion euros at end-March, down 0.5 billion from late 2011 to a net debt to EBITDA of 2.2 times , confirming the group aiming for 2012 a 2.5 rating and a Class "A".

Shortly after the start of the general meeting of shareholders of the group, at 1440, the GDF Suez fell by 2.62% to 18.195 euros, while the CAC 40 lost 2.13%.

Barely a quarter of the companies should increase their investments in 2012, according to a study of the credit insurer Euler Hermes. They would increase the total of 0.5%. And because of that growth should be limited to 0.4% over the year.

Business investment was an engine of French growth in late 2011. And it should still contribute positively to GDP growth this year. But not enough to generate a rebound expected by the government. A study of the credit insurer Euler Hermes posted Wednesday, in fact, only a quarter of French companies plan to increase their investments in 2012. And made to depend on two spending growth prospects. And as these are faiblardes, their investment projects are too. This is the snake biting its tail …

Business investment should experience an increase shy of 0.5% annual rate in 2012, according to Euler Hermes. And growth in France would be reduced to 0.4%. Accompanied by a table yet another bad news: the quality of these investments will continue to deteriorate.

To forecast, Euler Hermes interogé 1684 companies from November to January. 25.8% said they plan to increase investment, 20.5% to 53.7% and reduced to maintain unchanged from 2011. "The wishes of investment are investments for renewal, not of development investments," said Ludovic Sénécaut, CEO of Euler Hermes, during a press conference.  

Thus, according to the study, 8.9% of these some 26% of companies ready to increase their spending account to make investments for productivity gains, 0.8% of spending on research and development. As for the increase in production capacity, it accounts for 19.1% of their spending intentions, while the renewal is 26.7%.

Most of the rest are investing in staff, told AFP chief economist of Euler Hermes, Ludovic Subran. Mr. Sénécaut notes that this situation of "low quality spending", already visible in 2011, "continues to deteriorate". Phenomenon "consistent with a French economy still facing enormous internal market and, when she goes to the international, country chooses and thus close to areas where the activity is and will remain weak for some years yet,"- he said.  

"We are very concerned about the effects of a second round of austerity measures in Italy, Spain and the UK," added Mr. Subran. Side outlets in the Hexagon, "there is still not in France of measures to fight against unemployment and unfortunately we can expect that it continues to increase in 2012," he said , holding that it is "worrisome" for consumption.

Euler Hermes also anticipates a rebound in 4% of business failures this year to 63,500, "record numbers", says Subran.

Asked about the presidential election, he felt that the campaign is the tax that could have "an effect on investment spending." "No candidate can become president without calling flat what is going on taxation in France. There is a volatility of taxes that worries companies," he said.

The price per m2 of existing homes totaled at the end of January 8340 euros on average, 30 euros less than in October 2011. Prices in the Ile-de-France, for the same period were down 0.6%. This trend is not sustainable. Paris real estate. St. Pierre Semard, in the ninth.

Prices of existing homes fell slightly in Paris, in 8340 euros/m2 average for the period between November 2011 and January 2012 instead of 8370 euros/m2 previously announced Thursday night the Chamber of Notaries of Paris-Ile de France. There had been increasing since the second quarter 2009 (6020 euros/m2). The downward trend in prices began in late last year, is confirmed, indicate notaries in a statement.  

Moreover, the promise of sale entered recently, which presage the final price trends, highlight the value of apartments in the capital between 8100 and 8200 averaged euros/m2 end of May, confirming a trend slightly downward (-2 to -3.2%), after a sharp surge in prices which had led to an annual increase of 21.3% in late August 2011.

For the entire Ile-de-France, house prices in Ile-de-France, for the same period were down 0.6%. The largest decrease is observed in Seine-Saint-Denis (1.4%), while a decline of 0.3% in Paris proper.

The decrease in the number of transactions recorded for several months, was temporarily halted because of the reform leading to higher taxation of capital gains on property that, with effect from 1 February 2012, caused an influx of sales. Thus, from November 2011 to January 2012, 43,000 existing homes were sold, an increase of 6% over the same period 12 months earlier, and even 32% in central Paris.

After the records set last year, the Paris notaries had anticipated the end of February the prospect of a market downturn of the former in 2012 on the entire region, suggesting a decrease of 5 to 10% less a "new rebound of the financial crisis". But this break "will be sustainable only if new construction is accelerating sustainable in Ile-de-France for several years," had they warned. In the provinces, prices are expected to experience the same slope, according to forecasts by the INSEE.

The government deficit in France in 2011 was lower than expected, which will facilitate the task of the next president if the economy does not collapse.

After 5.2% of GDP last year, instead of 5.7% expected in the Finance Act, Nicolas Sarkozy and François Hollande, favorite polls, have pledged to re reduce the public deficit to 4.5% and 3.0% end of 2012, limit the European stability pact in late 2013.

The effort would be lower than expected.

The outgoing president praised the figure of Friday.

"France has done much better thanks to the efforts of the French," he said, renewing his promise to reach 3% in late 2013. 

But the trend was poor in January and a sharp economic slowdown is expected for all of 2012, likely to derail the accounts if it were larger.

The "good" figure of 2011 on Friday will also be confirmed by further appreciation expected on May 15

The government balance includes accounts of the state, local and social security funds. It has not been positive since 1974.

Nicolas Sarkozy promised to return to balance end of 2016 and his Socialist opponent François Hollande end of 2017.

DOUBTS IMPORTANT FOR 2012

In January, the government deficit, which is the largest component of public deficit fell by less than a billion euros over January 2010.

A negative signal, even if the accounting parameters are not identical, to the rise or fall, a positive impact of € 2.6 billion having been such registered in January through the sale of radio frequencies.

The government deficit in February will be released April 6.

Especially, strong economic growth this year, which largely determine the amount of revenue is uncertain. 

The government has just raised its growth forecast for 2012 to 0.7% against 0.5% earlier (after 1.7% in 2010), while Francois Hollande provides 0.5% .

International institutions and economists are less optimistic, the IMF providing 0.2%, 0.3% OECD and the European Commission 0.4%.

The evolution of public finances is crucial for France, already deprived of its precious AAA by Standard and Poor's and sees its sovereign rating placed on "negative outlook" by the three major rating agencies.

Borrowing costs on financial markets may increase, which would make the effort to restore data even more important. 

The yield differential ("spread") between the French public debt to 10 years and German debt is currently above 110 basis points, or 1.1%.

This level is much lower than that achieved in November, at the height of tensions on the debt in the eurozone, to nearly 200 points, but it is much higher than the observed 30 to 40 points s during "normal".

Wall Street on Wednesday accused its second consecutive decline, fall within the scope of both oil prices and that metal, evolution has led investors to die ; lester values ​​related to raw materials.

The Dow Jones Industrial 30 yielded 0.54%, or 71.52 points, to 13,126.21. The S & P-500, wider, lost 6.98 points, or 0.49%, to 1405.54. The Nasdaq Composite fell on its side of 15.39 points (-0.49%) to 3,104.96.

The lower growth than expected durable goods orders in the U.S. in February (2.2% against 3.0% expected) has renewed concerns surrounding the recovery in the U.S. .

In addition, analysts said, the traditional quarter-end purchases seem to subside, which removes a source of support on Wall Street.

The S & P 500, and undergoes its worst session in three weeks, however, shows an increase of 11.4% since the beginning of the year, the benchmark fund managers are well on track to sign its best quarterly performance since the third quarter of 2009.

Cleaning portfolios to "the end of the quarter had probably carried the stock market these days. This factor plays up because if you buy less value today, it will not be settled before Monday so it will not appear in the first quarter figures, "noted Robbert Van Batenburg, head of equity research at Louis Capital

. The S & P grouping the values ​​linked to commodities fell ; of 1.52% and the energy sector has yielded 1.23%

. action number a global mining equipment Caterpillar fell 3.52% to 104.26 dollars, thus showing the biggest drop in the Dow Jones

….. The heavy oil …. ExxonMobil and Chevron also weighed, with declines of respectively 0.88% to 85.86 dollars and 1.07% to 105.89 dollars ..

……. Despite the decline of day, that the S & P 500 is not dropped below the 1.400 points suggests that the fundamental cycle bull bringing Wall Street six months ago are still in place, said Jim Paulsen, Investment Officer at Wells Capital Management.

Oil prices were down nearly 2%, under the double blow of surging crude inventories in the U.S. and the prospect of more countries use their re reservations policy to curb the sharp rise in gasoline prices.

Gold and copper also fell after data on durable goods orders, that interrupt a series of statistics considered positive for the U.S. economy.

During the meeting, Apple has hit a new record of 621.45 dollars. The action ended at 617.62 (0.51%)

What the President of the U.S. Federal Reserve Ben Bernanke about the need for maintaining an accommodative monetary policy to reduce unemployment continue to support markets Tuesday, allowing an opening up of major European stock markets, despite the announcement of a decline in morale of German households.

In Paris, in early trade, the CAC 40 gained 0.16% to 3,507 points. In Frankfurt, the DAX 30 is 0.4% to 7,104.83 points. In London, the FTSE advance of 0.2%. The pan-European index Stoxx 50.

The Fed chairman once again on Monday expressed concern about the long-term unemployment, but he questioned the idea that this problem is due to ; structural factors outside the scope of monetary policy.

The consumer confidence index calculated by the German research firm GfK is down at the approach of April, to 5.1, ending six months of gains, income expectations households being affected by rising fuel prices.

But the morale of French households is up against him for the month of March, returning confidence index five points. 

The Tokyo Stock Exchange is in turn mounted to its highest level since the earthquake and tsunami of March 2011, the Nikkei ended up 2.4%.

The "binge drinking" – drinking very popular with young people – cost 3.2 billion euros per year in British public health service. The Prime Minister has decided to increase the price of ciders, beers and spirits. The British Chancellor of the Exchequer, George Osborne, to Parliament.

This is a serious blow to the culture of beer. British Prime Minister David Cameron said on Friday a series of measures, including an award minium of 40 pence per unit of alcohol, to fight against "binge drinking", drinking bouts which cost 2.7 billion pounds (3.2 billion euros) per year in public health service.

"The binge drinking + + accounts for half the consumption of alcohol in this country," said the Prime Minister. "My message is simple. We can not continue like this." It proposes to introduce a minimum price of 40 pence (50 cents) per unit of alcohol (10 ml of ethyl alcohol) sold.  

The measure will hit priority ciders sold cheap, strong beer and spirits sold off. For example, an extra strong beer that contains three units of alcohol would see its price from 75 pence to 1.20 pounds (1.40 euros). The strong cider, four units of alcohol, would almost double their price in almost two euros. The minimum price is to include the purchase of alcohol at bargain prices in supermarkets.

"Let's be clear, this will not affect the pubs," he told Mr Cameron. "A pint of beer contains two units of alcohol, if the minimum price is 40 pence per unit, the pint will not be affected." The government says the measure could even benefit the pubs, preventing supermarkets from selling at bargain prices. The government plans to prohibit the promotion of "two drinks for the price of one" and introduce a tax for pubs that open late, a way to offset the cost to ensure public safety in their neighborhood.

The culture of "binge drinking" has led last year by 1.2 million hospitalizations and a million crimes and crimes related to alcohol, according to official figures. The government intends to launch a consultation in the summer. Future legislation will apply in England.

Scotland is also considering a minimum price for alcohol. "We will launch a consultation, but a minimum price of 40 pence would result in 50,000 fewer crimes each year and 900 alcohol-related deaths averted annually by the end of the decade," said Mr. Cameron. The retail federation has protested vigorously. In contrast, associations fighting against alcoholism and the medical applauded the announcement.

The rating agency has again lowered the credit rating of Greece, "C", which corresponds to an almost certain risk of default. Moody's in New York.

The U.S. rating agency Moody's said Friday night that lowered the credit rating of Greece to "Ca" to "C" to reflect the launch of the restructuring of public debt in Athens. This operation "entails expected losses of more than 70% for investors" who will participate, Moody's wrote in a statement.

Moody's assigns a "C", the lowest possible rating on its classification as it deems to borrowers on the edge of default, while a rating of "Ca" she attributed so far to the Greek public debt corresponds to the speculative issuers in which the failure seems likely. The agency says that in his view, the swap of debt proposed by the Greek government to its private sector creditors, whose success is imperative to allow "the provision [of Athens] a additional financial assistance of the euro area "will return, if completed, a" default "on" Greek government ". The agency was then referred to the new European rescue plan providing 130 billion euros of aid set in motion Thursday.

Its rival Standard & Poor's lowered the credit rating Monday of Greece to "SD", a level corresponding to "selective default", to reflect the debt erase operation launched three days earlier. S & P said it planned to raise the rating to CCC of the country, which she attributed to poor quality of issuers with a real risk of default, where such operation would have been fully completed, probably in mid- in March.

This is not the case of Moody's, which does not assign "perspective" to the Greek note, sign it refuses to speculate on what could be its evolution after the debt swap consumed. "Regarding the future, the program of the European Union and the proposed debt exchange will reduce the debt burden for Greece, but the risk of default of the country will remain high even after this exchange has been completed, "the agency wrote.  

"Moody's believes that Greece still faces challenges in the medium term solvency: the ratio of public debt to GDP is well above 100% for several years," the statement added.

Restructuring launched Feb. 24 to allow Greece to obtain a cancellation of debt of 107 billion euros. Athens proposes to give private creditors participating in the operation of securities worth less than 53.5% of those they currently hold. A quarter of those titles that creditors will receive bonds from the European Stability (EFSF), presumably with a maximum maturity of two years. The rest will consist of new Greek bonds with maturities ranging from 11 to 30 years, a period much greater than those they replace. Because interest rates that will yield these securities loss to creditors should be around 73%.