Euro steady after Irish Republic 85bn euro bail-out
Baku, November 29 (AZERTAC). The euro was steady against the dollar as markets opened a day after European ministers agreed a bail-out for the Irish Republic.
Ministers have reached an agreement over a bail-out worth about 85bn euros ($113bn; £72bn).
The deal will see 35bn euros go towards propping up the Irish banking system, with the remaining 50bn euros to help the government`s day-to-day spending.
In early trade on Monday the euro was ahead by 0.40% at $1.3241.
It had earlier slipped to $1.3181, its lowest level since 21 September, before rebounding.
European stocks were also largely unchanged, with London`s Ftse up 0.37% at 5,689.94, Frankfurt`s Dax ahead by 0.27% to 6,867.77 and Paris`s Cac up 0.52% to 3,748.10.
But Irish bank shares rose, with Allied Irish Banks up 8% and Bank of Ireland up 17%.
Meanwhile, yields on ten-year bonds in the Republic of Ireland, Portugal, Spain, Greece, Belgium and Italy were largely unchanged on Monday morning, as reaction to the bail-out was largely muted.
However, the price of oil rose to a two-week high above $85 a barrel, with US crude up $1.27, or 1.5%, to $85.03. Brent crude rose $1.08 to $86.66.
Meanwhile, European Central Bank policymaker Christian Noyer sought to bolster market confidence in the eurozone`s rescue for the Republic.
Mr Noyer is the first member of the ECB`s policy council to speak after eurozone ministers sealed the deal for Dublin on Sunday.
He said he was confident the deal would bring down Dublin`s borrowing costs to more normal levels.
"There is no reason to doubt the recovery plans of the two countries," Mr Noyer said in a speech in Tokyo, referring to Ireland and Greece.
And French Finance Minister Christine Lagarde said the bail-out was "sufficient" and that "irrational" markets were not correctly pricing the sovereign debt situation in Europe.
"The amount [of the bail-out] is sufficient because that will keep Ireland afloat for three years," she told RTL radio.
France and Germany have also said the Republic of Ireland bail-out should draw a line under its debt crisis.
And they have expressed confidence in Portugal`s ability to correct its finances and avoid needing outside help.
`Best available deal`
An average interest rate of 5.8% will be payable on the loans, above the 5.2% paid by Greece for its bail-out.
Irish Prime Minister Brian Cowen said it was the "best available deal for Ireland".
It provides "vital time and space to successfully and conclusively address the problems we`ve been dealing with since the financial crisis began", he said.
The Irish government has also said that interest payments on all state debt will account for more than 20% of tax revenues in 2014.
The deal does not require the Republic to change its low 12.5% corporation tax.
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