It’s a great time to be an opposition in Europe. With sliding economic growth and unpopular bailouts, it’s very easy to score points. And we all know that opposition leaders will say anything to get elected and that those in power will do anything to keep it.
The euro is slipping here, down 40 pips since the vote to 1.3636. It’s not sliding because Slovakia may not ratify the EFSF changes (they will), it’s falling because the vote will cost Slovakia’s leaders their jobs.
Other leaders are watching and they don’t want to be next. Approving further bailouts for the periphery is going to be hugely problematic and a persistent EUR headwind.
