The euro sank to a near two-year low against the dollar on Tuesday amid worries about the solvency of Spanish banks, and as the governor of the country's central bank quit. The single currency fell below $1.25 after rating agency Egan-Jones cut the country's credit rating. Against the pound it was worth 79.95p.
Miguel Ángel Fernández Ordóñez, governor of the Bank of Spain, will step down on 10 June, a month earlier than expected, the central bank said.
The decision came amid fierce criticism from the ruling People's party over the central bank's role in failing to deal quickly enough with the toxic real estate problems of Spanish banks. The government has invited external auditors to value bank assets, in effect bypassing the central bank. The government is expected to ask central bank board member Luis María Linde to take over. » | Ian Traynor, Giles Tremlett and agencies | Tuesday, May 29, 2012
THE GUARDIAN: One bust bank could bring Spain to its knees, warns prime minister: Government will not allow any bank or regional government to collapse 'otherwise country will fall,' says Mariano Rajoy » | Giles Tremlett in Madrid | Tuesday, May 29, 2012