Iceland remains in the headlines today. After the Icelandic president earlier today vetoed a plan to payoff the UK government which made good on savings “frozen” when Icesave collapsed.
Now the government’s debt rating is being downgraded to BB+ from BBB- and left on review for further downgrade by Fitch. This is less impactful now that Iceland’s economy has collapsed but reminds us that not long ago (eighteen months ago?) Iceland was an emerging markets star…
EUR/USD is mildly pressured after the news as European banks are more exposed that the rest of the globe to Icelandic debt. EUR trades now at 1.4385. Stops are seen in the 1.4375/80 region.
