Damage control in Hungary where government officials tried to distance themselves from Friday’s reckless comments from a spokesman on their finances and a reiteration of their pledge to meet IMF budget targets are helping to lift markets off their early morning lows. The Hungarian Forint is bouncing higher after earlier weakness. Also helping was a 2.8% rise in German April manufacturing orders, much better than the expected drop of .4%. The euro spot hit a low of 1.1877 overnight, just off its 1st day Jan 4th ’99 close of 1.1837. It began that day at 1.1747 and if only we closed our eyes on that day and opened them today we’d see a decade of currency stability, as if. The German 10 yr bund yield hit a fresh record low ahead of expectations of budget cuts from Merkel’s government. Not becoming the next Greece is the European rallying cry to get budget cuts passed and there is nothing like a crisis to get politicians to act.
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