Irish Spreads Jump As Country Is First To Officially Double Dip
by Tyler Durden
Irish bond spreads are back in the spotlight, with Bund spreads jumping by over 20 bps to over 415 bps, although not on the heels of a failed auction (the country did auction off €400 million in February and April 2011 bills earlier, which was less than sought), but rather on news that Ireland is the first country in Europe to officially double dip back into negative growth. Ireland was also the first European country to dip into recession what may seem like an eternity ago. The stunner is just how vast the difference between the expected and the actual economic reality was. As BBC reports: “The Irish economy shrank in the second quarter from the previous three months, surprising analysts who had been expecting growth. Gross domestic product (GDP) fell 1.2%, the Central Statistics Office said. It also revised down its measure of growth in the first quarter to 2.2% from 2.7%.” So poor Ireland not only has to deal with a drunk PM, insolvent bank system, and, what is not surprising a new economic crunch, but what is far more concerning, a Department of Truth and Unicorns, which is unable to lie its teeth off and paint a rosy picture when the feces are already in process of being fanned.
Amusingly enough, the reason cited by the Irish Finance minister as the reason for the depressed GDP figure, is the surge in imports during Q2. So now we know who was buying up everything China was making, even if it cost them a formal double dip announcement.
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