By Delusional Economics, who is horrified at the state of economic commentary in Australia and is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness .
Spain took a beating overnight after Moody’s downgraded the long term debt and deposit ratings of 28 Spanish banks on the back of the sovereign downgrade earlier in the month. Yields on short term debt spiked at auction:
Spain’s short-term borrowing costs nearly tripled at auction on Tuesday, underlining the country’s precarious finances as it struggles against recession and juggles with a debt crisis among its newly downgraded banks.
The yield paid on a 3-month bill was 2.362 percent, up from just 0.846 percent a month ago. For six-month paper, it leapt to 3.237 percent from 1.737 percent in May.
Italian retail sales plummeted in April, falling 1.6% in seasonally-adjusted terms from the month before as residents of the euro zone’s third-largest economy reduced purchases of both food and other goods and services, national statistics institute Istat said Tuesday.
The drop–the largest in at least eight years–was far larger than the average 0.2% monthly drop forecast in a poll of economists by Dow Jones Newswires.
Retail sales in Italy are now down 6.8% in unadjusted terms from April 2011, Istat said.
Not to be left out there was also Cyprus :
Cyprus, which became the fifth euro zone country on Monday to seek emergency funding from Brussels, may require a bailout amount worth up to half the size of its economy, domestic media reported on Tuesday.