World Bulletin/News Desk
Socialist President Francois Hollande's 2013 budget amounts to France's toughest belt-tightening for 30 years as the debt crisis takes its toll on the euro zone.
The package aims to narrow France's deficit to 3.0 percent of national output next year from 4.5 percent this year, bringing in 30 billion euros ($39 billion) for the treasury.
But the budget dismayed business by opting for tax hikes -- including a 75 percent tax on those earning over one million euros a year -- by holding public spending and not cutting government jobs.
With Hollande facing record unemployment and economic stagnation, there were also fears the deficit target will slip as France falls short of the modest 0.8 percent economic growth rate on which it is banking for next year.
"This is a fighting budget to get the country back on the rails," Prime Minister Jean-Marc Ayrault said, adding that the 0.8 percent growth target was "realistic and ambitious".
In Spain, an independent audit of the country's banks confirmed that a manageable 59.3 billion euros in extra capital is needed for them to ride out a serious economic downturn, buying time for Rajoy who faces intense pressure to seek an international bailout.
The audit is a condition of getting European funds to patch up Spanish banks that have been damaged by a prolonged real estate crash.
Spending cuts and tax hikes in response to the euro zone debt crisis are throttling any recovery in the euro zone's fourth largest economy, driving up unemployment and prompting sometimes violent street protests.
Spain has replaced Greece, Ireland and Portugal as the main threat to the survival of the euro currency project.
Both the strict 2013 budget presented by Rajoy's government on Thursday and the audit of 90 percent of Spain's banking system are necessary steps for Madrid to request sovereign aid and trigger a European Central Bank bond-buying programme.
The audit results, which will be used to determine how much aid Madrid will tap from an agreed 100-billion-euro European credit line for the banks, were in line with government and market expectations and were applauded by the European Commission.
"That's another layer of uncertainty that's off the table," said David Schnautz, rate strategist at Commerzbank.
In further signs that austerity measures imposed on the euro zone's struggling southern members are having a harsh social cost, thousands of trade unionists marched through Rome as part of a general strike, forcing authorities to close the Coliseum.
Opposition to austerity policies aimed at steering Italy out of its economic crisis is growing as the country's year-long recession shows no signs of ending and unemployment continues to rise.
"At the moment, I just can't see a future that gives us any hope, particularly for the youth," Emilio Amiraglia, a former Italian soldier, said.
The march by mainly public sector workers followed clashes between anti-austerity protesters and police in Madrid and Athens this week.
In the euro zone's paymaster Germany, Angela Merkel learned on Friday that she will face former finance minister Peer Steinbrueck as the opposition Social Democrats' leader in next year's election, a development that may cause some unease in the chancellor's camp.
Steinbrueck, a combative veteran from the right of the centre-left SPD, backs tougher rules for banks and a coalition government with the Greens.
Analysts saw his rapid emergence from a three-way struggle within his party as the outcome most threatening to Merkel, though polls show the conservative leader still well ahead.
"We want to oust this government. We want to make sure it isn't just partially replaced but completely replaced with an SPD-Greens government," he told a news conference, referring to the ecologist party currently ranked third in opinion polls.
Treasury reports central government debt stock in March rises around 15 pct year-on-year, reaching nearly $235 billion
Sales to foreigners amounted to 1,827, 15.8 pct rise year-on-year, according to official report
BIST 100 slips 0.15 percent; US dollar/Turkish lira exchange rate stands at 4.0460
BIST 100 rises 0.01 percent; US dollar/Turkish lira exchange rate drops to 4.0250
Fresh hopes that Donald Trump and North Korea's leader Kim Jong Un will hold a historic summit within months also provided some much-needed optimism.
The fund cautioned that investors and financial markets expect a steady approach to monetary tightening based on the belief inflation will remain relatively tame.
Turkey's assets abroad go up 2.4 percent at end of February 2018, compared to end of 2017: Turkish Central Bank
BIST 100 decreases 0.12 percent; US dollar/Turkish lira exchange rate stands at 4.1020
Hong Kong and China ended down after fluctuating through the morning on data showing the world's number two economy expanded in January-March at the same rate as the previous three months.
For Turkey, Germany is a very important, indispensable partner: Turkish Energy Minister Albayrak says in Berlin
BIST 100 rises 0.69 percent; US dollar/Turkish lira exchange rate stands at 4.0830
The United States, Britain and France carried out attacks at the weekend on alleged chemical weapons facilities, in response to what they say was a toxic gas attack by the Russia-backed Assad regime a week before.
Excluding interest payments, central government budget balance saw surplus of nearly $500M in first quarter of 2018
London's FTSE 100 index fell 0.1 percent to 7,254.83 points, with UK advertising giant WPP diving four percent after chief executive Martin Sorrell resigned over the weekend.
The US, Britain and France carried out attacks at the weekend on alleged chemical weapons facilities, in response to what they say was a toxic gas attack by the Russia-backed Assad regime a week before.