Despite assurances from the European Union’s two largest members, investors continue to avoid the euro over fears the debt crisis could spread. Even the announcement released over the weekend that Ireland would receive US$115 billion (85 billion euros) in funding to prevent the Republic from defaulting on its debt, failed to prevent the euro’s continued fall.
Indeed, critics are now turning their attention to Spain and Portugal where the spread on bonds and credit default swaps has reached record wide levels.
“I think it is almost impossible now to stop the contagion,” said Mark Grant, managing director of corporate syndicate and structured debt products at Southwest Securities in Florida.
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