AFTER SORTING GREEK PROBLEMS, EU MINISTERS TURN TO SPAIN - Euro zone finance ministers have backed Greece's second bail-out of €130 billion pending a contribution from the International Monetary Fund. Yesterday's meeting in Brussels yesterday to approve the package followed Greece swapping most of its privately-held bonds with new ones worth less than half their original value. Finance ministers also signalled that Spain will be given some flexibility in its budget deficit targets in 2012 after the announcement by the Spanish government that it was refusing to meet the fiscal goal set under the EU rules.
Charles Forelle, from the Wall Street Journal in London, says the move by the Spanish authorities will be the true test of the new fiscal compact and he says the battle will be key as to how the markets view the compact. Spanish bond prices will not be helped by the news, he adds.
On Greece, the journalist says that euro zone finance ministers said they will sign off on the bail-out with just technical steps now to be completed. He says the country's bond swap went better - and more smoothly - than anyone had expected. He says it was a good result for Greece, which is not accustomed to achieving good results in such matters.
The euro zone finance ministers are today also due to discuss the financial transaction tax and Mr Forelle says EU states are sharply divided over the issue, with particular concern evident in the City of London. He says countries are afraid that if it is introduced in some states and not others, it will result in unfair competitive advantages. He adds that the EU can not compel any country to introduce such a tax against their will.
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IRISH HOTEL ROOMS SEE FIRST INCREASE SINCE 2008 - Last year the average price of a room in Ireland increased for the first time since 2008. Prices rose by 4% over the year to €82. Westport in Co Mayo has become the most expensive place in Ireland for hotel rooms. The hotels.com hotel price index shows that the average cost of a hotel room in Westport increased by 7% last year to €111. Dublin, though, was found to have the cheapest rooms for a capital city in Western Europe at an average €76 a night - a 4% increase on 2010.
Seamas MacCormaic, director of market management at hotels.com, says that falls in the prices of hotel rooms had been so steep, they had to start to recover at some stage. He says that as well as the visit of the British queen and the US President last year, Dublin also saw good sporting and music events which brought people to the city. He also says that new air routes bringing people in from countries where they still have more money to spend - including the Middle East and Australia - is also contributing to the price rises as demand increases.
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MORNING BRIEFS - A report from Goodbody Stockbrokers on residential property prices says there has been an average fall of 68% from their peak asking prices. Goodbody says this is "greater" than official indices would suggest, but its report is based on just 311 residential property sales, at the five Allsop Space auctions that there have been to date. Economist Dermot O'Leary says that while it is possible there will be further weakness in prices because of lack of access to credit and the weak domestic economy, his analysis of the market suggests that residential property prices currently represent fair value.
*** An increasing number of business men in Japan are ditching their ties and embracing a more casual style, a survey shows. 28% of men said they work without a tie year-round, not just during the summer "Cool Biz" season, according to the survey conducted by the Nikkei business daily and Macromill, a polling company. And 83% of respondents said they would go tie-less all year if they could, suggesting a decided shift in attitudes in buttoned-up Japan Inc. Japan kicked off its "Cool Biz" campaign in 2005, encouraging firms to limit air-conditioning use to help lower electricity use, and workers were urged to drop their neckties. Even the prime minister and cabinet followed suit.
*** On the currency markets the euro is trading at $1.3164 cents and 84.08 pence sterling.
