Euro falls after Spanish referendum

EPA-EFE/Robin Townsend

Euro falls after Spanish referendum


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The euro fell in Asia on Monday as investors kept an anxious eye on an independence vote in Spain’s Catalonia, while surprisingly strong economic news out of China and Japan offered support to equities and commodities.

The euro fell 0.3 % after the violence-marred vote to trade at $1.1773, though European bourses seemed less troubled with financial bookmakers pointing to small opening gains for the major indices.

Spanish police used batons and rubber bullets to thwart an independence vote in Catalonia on Sunday in a show of force that left hundreds injured, according to Catalan officials, and presented Madrid with a huge challenge to calm tensions in the region.

The situation was fluid, with the head of the regional government opening the door to a potential declaration of independence from Spain.

The leader of Catalonia opened the door to a unilateral declaration of independence after regional officials said more than 90 percent of Catalans voted in favor of a split from Spain in a referendum called illegal by national authorities in Madrid.

Catalan President Carles Puigdemont on October 1 said in a televised address that “on this day of hope and suffering, Catalonia’s citizens have earned the right to have an independent state in the form of a republic.”

“My government, in the next few days, will send the results of today’s vote to the Catalan parliament, where the sovereignty of our people lies, so that it can act in accordance with the law of the referendum,” Puigdemont added.

Before the referendum, opinion polls indicated a minority of around 40 percent of the region’s total 7.5 million people supported independence, although a majority of residents in the region nonetheless wanted a referendum to take place.

Many of those opposed to independence had been expected to boycott the vote, leaving the “yes” side a likely clear favorite to prevail.

The referendum and subsequent police actions surrounding the vote have raised tensions in the Catalan region and throughout the rest of Spain.

The referendum was banned by Spain’s Constitutional Court, which ruled it violated the 1978 constitution that restored democracy in Spain following the death of dictator General Francisco Franco.

Catalonia’s authorities said at least 844 people “required medical attention” in violence related to the vote as officers in riot gear raided public buildings to prevent them from being used as polling stations.

Police said at least 33 law enforcement officers were also injured.

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