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I house prices in Spain experienced a major global bubbles, which means that, despite having fallen from 10% to 20% so far, have scope for further falls in prices as International Monetary Fund (IMF), however, believes that English banks "can deal with this situation without serious problems."
"I think there is room to lower prices in Spain," admitted the economic counselor and director of the IMF's Research Department, Olivier Blanchard, who stressed his view that "the English banks can assume without serious problems. "
Blanchard agrees with the statements published by Financial Times columnist, Wolfgang Munchau, saying that "in general, housing prices (in Spain) rose a lot and have declined somewhat, I think between 10% and 20%, which is considerable, but still could go lower, " Blanchard said.
Spain
do the right thing
On the other hand, Blanchard said the "significant" measures taken so far by the English Government both in terms of transparency of the financial system and the restructuring of banks savings, as well as labor market reform.
Thus, the international institution has highlighted the progress made by Spain for other economies when it comes to clear the uncertainty about the quality of the assets of the Bancayan increase the sector's capital reserves.
"The markets are making a clear difference between Spain and countries in trouble," said Blanchard, who ruled that "Spain is doing exactly the right thing", but warned that "will take years to make things better."
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