Vincent Fernando, CFA
May 31, 2010
Spain’s ruling Socialist party, led by prime minister Jose Luis Rodriguez Zapatero, has seen its popular support collapse.
The current financial crisis and a backlash against proposed austerity measures are taking their toll:
A poll conducted for El Mundo newspaper by Sigma Dos showed on Sunday that the opposition Popular Party (PP) would take 45.6 percent of the vote if an election were held now, 10.5 percentage points ahead of Zapatero’s Socialists.
The Socialists held a 3 point lead over the conservative PP at the March 2008 general elections. But their handling of the economic crisis and unemployment, which has more than doubled to 4.6 million since then, has gutted their support.
Another opinion poll in the El Periodico newspaper on Saturday put Zapatero’s party 8 percentage points behind the PP.
Conducted May 25-27, the Sigma Dos poll followed the government’s announcement of an additional 15 billion euro ($18 billion) austerity plan imposing pay cuts on civil servants and freezing welfare handouts.
Spain will likely need to call fresh elections if it wants to garner enough support the 2011 ‘austerity’ budget, according to Reuters. Given there was massive opposition to the latest 15 billion euro plan, let’s see what kind of watered down ‘austerity’ actually happens once all is said and done.
Get ready for Monday, it’s going to be a challenging day for Spanish debt, given the political problems above plus the fact that it just had its ratings cut from AAA last Friday.
This article was posted: Monday, May 31, 2010 at 4:09 am