The ECB seems to be loyal to the Spanish government. This fact is confirmed by the total sum of the loans borrowed by Spanish banks from the ECB. In July, it increased up to €376bn. The lending volume has been growing for 10 month in a row.
At the same time, the Spanish 10-year bond yield increased by 5 percent points up to 6.79% during the latest bond auction.
There are rumors that Spanish government and central bank are going to address the ECB to ask for further financial support, which is estimated at €30bn. The money will be used to recapitalize other 4 banks: Banco de Valencia, Bankia, Nova Galicia and Catalunya Bancо.
Forex.
According to , the Euro is retracing against the US Dollar. The experts report that EURUSD is forming wave C of level H4 (started at 1.2343).
The closest levels of support are 1,2273 and 1,2258.
The current mid-term downtrend will be completed as soon as the price overcomes the top of the MF sloping channel and consolidates above 1,2338 (as shown below).
