Spanish Bond Risk Rises As Catalan Referendum "Dialog" Heats Up

Early kneejerk exuberance in Cable and European bond risk is rapidly unwinding as the reality of a revolting youth raise concerns over social stability. Nowhere is that more evident than in Spain this morning as pro-Catalan independence supporters push the government for a referendum on their secession in November:

  • *CATALANS SAYING LOUDLY BUT GENTLY THEY WANT TO DECIDE: MAS
  • *SPAIN GOVT OPEN TO DIALOG, HAS TO COMPLY WITH LAW: SAENZ
  • *REFERENDUMS ARE NOT POSSIBLE IN SPANISH LAW, DEPUTY PM SAYS

Catalan President Artur Mas says it is a mistake to think the Scottish “No” votes casts a shadow over Catalonia and is threatening Rajoy if he blocks the vote. Spanish bond risk is up 12bps off the lows of the day.

As Bloomberg notes,

  • *MAS SAYS SCOTS-STYLE REFERENDA ONLY WAY TO RESOLVE CONFLICTS
  • *MAS SAYS CATALONIA PUSHING ON WITH INDEPENDENCE VOTE
  • *MAS SAYS MISTAKE TO THINK SCOTS NO CASTS SHADOW OVER CATALONIA
  • *MAS SAYS BLOCKING VOTES CREATES DIVISIONS
  • *MAS SAYS RAJOY IS FUELING CATALANS’ AVERSION TO SPANISH STATE
  • *MAS SAYS HE’LL CALL MEETING OF ALLIES IF RAJOY BLOCKS VOTE
  • *MAS SAYS RAJOY CAN’T HOLD BACK CATALANS JUST WITH LAW

But, the government says…

  • *SCOTS VOTED ACCORDING TO LEGALLY ESTABLISHED PROCESS: SAENZ
  • *REFERENDUMS ARE NOT POSSIBLE IN SPANISH LAW, DEPUTY PM SAYS
  • *SPAIN GOVT OPEN TO DIALOG, HAS TO COMPLY WITH LAW: SAENZ

So change it…

  • *CATALANS SAYING LOUDLY BUT GENTLY THEY WANT TO DECIDE: MAS
  • *CATALONIA WANTS TO HOLD VOTE IN AGREEMENT WITH SPAIN: MAS
  • *REFERENDUM WOULD SOLVE CATALAN QUESTION, MAS SAYS

The Reaction – spanish bond risk is rising…

 

and Cable has roundtripped last night’s gains as new policies are better understood

*  *  *

It appears this secession movement is far from over…

 

Charts: Bloomberg




via Zero Hedge http://ift.tt/ZtWz8Y Tyler Durden

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