Bankia suspended as government unveiled its largest recapitalisation plan

Bankia suspended as government unveiled its largest recapitalisation plan

The US Dollar is continuing to strengthen against the loonie with the Canadian dollar on course to hit its lowest levels since September 2011. The main cause is being blamed on the fall in consumer confidence in the nation’s biggest trade partner with many Americans feeling uncertain over the future; this caused commodities to fall to their lowest level in four months.

Ongoing doubts over the Euro situation have not been helped due to the news coming out of Spain. Shares in the nation’s third biggest bank, Bankia were suspended on Friday as the government unveiled its largest ever recapitalisation plan, plunged 27% before recovering. The government has already pledged to pump up to €19billion into the troubled bank. The Spanish newspaper, El Mundo fanned fear by claiming that a further €30bn was required to rescue four other banks, CatalunyaCaixa, Novagalicia, Banco de Valencia. Speculation is rife over whether the Euro central bank will be forced to step in and help salvage the situation.

“Commodity-centric currencies like the Canadian dollar will remain under pressure unless you have some sort of sign that Europe is getting its act together and growth will have a chance to stabilize,” said Adrian Miller, director of global markets strategy at GMP Securities LLC.

In India the Rupee is on course to hit a record low against the US dollar as oil importers ramped up demand for the greenback ahead of the end of the month, while global risk assets were hit by rising worries about Spain. It is currently at the 56.09/11 per dollar level, weaker than its 55.67/68 close earlier in the week.

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