Catalán Declarar Indepence

Friday, 27th October: We started the week with political headlines, and it is how we are going to end it too. This afternoon the Catalan regional parliament has voted to declare independence from Spain, just moments before Madrid officially imposed direct rule on the region. This has all come about following an “illegal” referendum vote at the start of the month. 43% of potential voters took part despite efforts of the Spanish police to dissuade people from voting. 90% were in favour of independence.  The Spanish PM immediately called for calm, promising to “restore legality”. What happens next though lies with PM Rajoy who is expected to hold a cabinet meeting to decide what measures to take. As we spoke of earlier in the week, Madrid could take full control of Catalonia’s finances, police and public media. It has been reported earlier this week that the Catalan leader could be facing up to 30 years in prison as a “violent and public” rebellion. Puigdemont yesterday opted against declaring independence, instead calling on MPs to decide.

As no surprise Spanish equities pared back following this afternoon’s events, closing lower by 1.47%. Spain’s 10-year government bond yield rose to 1.6% as investors sold off Spanish bonds. The euro continued from yesterday’s losses, falling about half a % against the dollar; less so against the pound.

Elsewhere, data from the US has shown the economy increased at a 3% annual rate in the July-September period, extending the robust activity reported in Q2 (3.1%). Growth had been expected to fall after back to back hurricanes, which are estimated to have caused losses of $121bn to privately owned fixed assets and $10.4bn in government-owned fixed assets.

Apple’s 10th anniversary iPhone was released to order today (on sale in shops November 3rd), although if you weren’t up early, there is already a 6 week waiting list (at least). Three have been criticised after announcing a £117 a month contract, although you do get unlimited data and minutes for that staggering monthly charge. Cheaper alternatives are available.

 

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