Derek Halpenny at Bank of Tokyo-Mitsubishi UFJ said probably the most worrying development for the euro was the surge in Italian government bond yields in response to S&P’s move.
He said: “Italy has the largest government bond market in the eurozone and continued rising yields there over the coming weeks would have a very destabilising impact on the eurozone debt markets.
“With the authorities still seemingly divided over how to proceed with the debt crisis there remains considerable short-term risks for the euro.”
Sounds like a good time for your folks to come over here on vacation. Your dollar will go a long away in relation to the euro (and the pound). Come on over! We need your money!