Slovenian Premier Alenka Bratusek resigned after 15 months in power to allow a snap vote, even after a bank cleanup she oversaw prompted Fitch Ratings to improve the nation’s outlook and helped the economy recover.
Slovak assets may rise as parties that pledge to cut the budget deficit and attract foreign investment hold a second day of coalition talks today after taking a majority of seats in weekend parliamentary elections.
The European Commission said Slovenia’s overhaul plan to avoid becoming the euro area’s sixth bailout nation is on the right track and the country must be ready to provide more capital for its ailing bank industry.
Slovenia eased concern that it will be the next euro-area state to need a bailout as investors scooped up twice the targeted amount in a debt sale yesterday. The country’s bonds surged and its default risk tumbled.
The Czech government’s funding costs fell to an all-time low for the fifth consecutive bond auction as the koruna’s appreciation to the strongest in four months added to expectations for interest-rate cuts to zero.
Czech Premier Petr Necas pledged to continue deficit cuts that helped reduce borrowing costs after a defeat in regional elections threaten to weaken him as the leader of the coalition government and his party.
The Czech political future may look a lot like its recent past after this weekend’s election: a government without the political strength and will to cut the country’s 163 billion koruna ($7.8 billion) budget deficit.
Slovak former Premier Robert Fico is poised to win elections after almost two years in opposition amid pressure to cut the budget deficit to distance the country from its ailing euro-area peers and avoid a rating downgrade.