Ireland

Ireland’s credit rating was cut by Moody’s to junk this week. The ratings agency warned that the country would need a second round of bailout.

Ireland’s downgrade comes a week after Moody’s lowered the rating for Portugal to junk status with a similar advice to get a second bailout. The credit rating agency sees that private investors need to share the pain of helping sinking European nations.

Dow Jones reported this week that the European Central Bank faces a potential crisis of its own because of "skeleton" risks amounting to several hundreds of billions of euros on its balance sheet.

The report says that the bailed out countries of Greece, Ireland and Portugal but Spain as well have provided as collateral asset-backed securities that are unfit for central bank loans because they have such low or non-existent debt ratings.

Still, providing the collateral allowed the countries to receive more financial support, Dow Jones said.
 

Jean-Claude Trichet, President of European Central Bank, called upon Ireland and Greece to keep to their commitments they made in return for financial help and said a broader European safety fund should be beefed up.

Trichet made his comments addressing a French talk show on the eve of a regular meeting of euro zone finance ministers which was set to discuss an increase in the effective lending capacity of the European Financial Stability Facility (EFSF).

Germany has changed its tone towards countries that contribute to the overall European debt saying that it remains committed to saving the euro zone. Germany’s finance minister ruled out the possibility that any country would ever be ejected from the European monetary union, and said calls to restore the Deutsche mark were “unrealistic nostalgia.”

Gold remained steady on Tuesday as uncertainty if Ireland could secure a bailout supported prices.

Spot gold edged down 0.2 percent to $1,363.6 an ounce by 0034 GMT.

U.S. gold futures gained 0.4 percent to $1,363.3.

Political uncertainty in Ireland squashed initial euphoria over an EU/IMF bailout plan in the previous session, driving the dollar up against a basket of currencies.

Holdings in the iShares Silver Trust hit a record high of 10,841.98 tonnes, suggesting robust investment demand in the metals.

Gold rose during Monday trades as the euro recovered after Ireland's rescue deal, helping the metal resist pressure from China's move to tighten its economy.

China's steps to rein in inflation could dim gold's appeal in the world's second-largest consumer after India, but dealers said a drop in bullion prices from all-time high levels were attracting purchases from other consumers in Asia.

Gold prices moved up on Friday as concerns over Ireland's debt woes diminished and helped the euro strengthen against the dollar.

Spot gold gained half a percent to $1,359.65 an ounce by 0027 GMT, building on gains from the previous session.

U.S. gold futures also rose by half a percent, to $1,359.5.

Hopes that Ireland's debt crisis will be resolved soon lifted the euro against other major currencies.

Ireland, the third-largest island in Europe and the twentieth-largest island in the world, lies to the north-west of continental Europe and is surrounded by hundreds of islands and islets. It’s separated from by the island of Great Britain the Irish Sea. The country, populated by slightly under 6mln people, has a strong presence on the International arena. The Irish tradition of folk music and dance is known worldwide, mostly through the phenomenon of Riverdance, a theatrical show consisting of traditional Irish step dancing.

The Irish government said Friday it would inject up to 4.0 billion euros, or $5.6 billion, into Anglo Irish Bank, recently nationalized by Dublin, subject to European Union approval. The announcement came as Anglo Irish Bank reported a pre-tax loss of 4.1 billion euros in the six months to March compared to a year earlier.