Top 10 Things To Do On The Costa del Sol

There are hundreds of things to see and do along the 150km of the Costa del Sol from water sports, to museums, to climbing, to zoos. You are sure to find something to fit your preferences.

If you do a search on TripAdvisor you will see hundreds of results and it could take a while to look through them all. As summer is approaching and tourists are planning their trips I thought it might help if we looked at the Top 10 and hopefully it will help you with at least a few days out during your visit.

1. Puente Nuevo Bridge (Ronda) / El Tajo (Ronda)

The Puente Nuevo Bridge over El Tajo gorge
The Puente Nuevo Bridge over El Tajo gorge

The Puente Nuevo Bridge is in the picturesque city of Ronda, around 40 minutes inland from the coast. It is the newest and largest of the three bridges that span the 120m gorge that splits the city and in which the Guadalevín River flows.

Construction of the bridge began in 1751 and took a staggering 42 years to complete. Over 50 builders lost their lives during construction.

Above the central arch there is a chamber that was originally used as a prison. During the Spanish Civil War, it is alleged that the chamber was used for the torture of captured enemy forces. Some were allegedly killed by being thrown from the chamber onto the rocks at the bottom of the gorge, named El Tajo.

Today, the chamber contains an exhibition of the bridge’s history and construction. It is a very popular tourist spot and a must-see for those visiting the coast. The bridge and the nearby viewing platforms provide astonishing views while the town centre provides a mesmerizing array of Spanish tapas. The square is encircled by coffee shops, tapas bars and restaurants.

Put Ronda on your list of things to do!

Trip Advisor Ranking – Puente Nuevo Bridge – 4.5 (2,091 reviews), El Tajo – 5 (975 reviews)

2. Parque De La Paloma (Benalmadena)

Parque De La Paloma, Benalmadena
Parque De La Paloma, Benalmadena

The Parque de La Paloma (Park of the Dove) is the largest green space in Benalmadena and is considered to be a central meeting point for the locals.

Situated in the small town of Arroyo de la Miel, the park consists of over 200,000 square metres of green space. It contains an artificial lake containing plenty of fish, turtles, ducks and the occasional swan. You won’t be alone even if there are no other people in the park thanks to the surprising amount of animals living there. Expect to see peacocks, hens, chickens and rabbits. You can also see mountain goats and ostriches, yes, ostriches. Other facilities include two children’s play areas, walking paths with clear signposting, natural wildlife and a restaurant area.

Parking and good disabled access are provided. More Information.

Trip Advisor Ranking – 4.5 (2,593 reviews)

3. Marbella Old Quarter (Marbella)

Plaza de los Naranjos (Orange Square)
Plaza de los Naranjos (Orange Square)

If you know Marbella at all you will think of it as a modern, bustling, tourist hotspot and probably the most popular and well known town on the Costa del Sol.

Take a step back from the main road though, and you will find yourself transported back to before the rest of the world discovered it and started to fill its beaches.

It is difficult to imagine a town that is so popular with modern culture managing to preserve so much of its past and also to retain its appeal with today’s demanding travellers.

As you walk through the narrow streets you will discover plaza after plaza, each surrounded with tapas bars and restaurants, and most filled with people. Orange trees line the paths and during summer the smell of orange blossom adds to the beauty of this small area of the coast.

Plaza de los Naranjos (Orange Square) is arguably one of the most popular, partly thanks to Judith Chalmers, ex-host of UK holiday show “Wish You Were Here”. Ms Chalmers was a frequent visitor to Marbella and often said Orange Square was her favourite part.

Many of the narrow streets are lined with small boutique shops and bars. They are very small and personal and most are open every day. Beware of the siesta though. A lot of the smaller, independent shops will be closed from 2pm to 4pm for a nap. This is more prevalent during the summer when daytime temperatures regularly exceed 40 degrees.

Trip Advisor Ranking – 4.5 (2,492 reviews)

4. Museo del Vidrio y Cristal de Malaga (Malaga)

Museo del Vidrio y Cristal de Malaga
Museo del Vidrio y Cristal de Malaga

Malaga’s Museo del Vidrio y Cristal sits within beautiful restored 18th century house not far from the city centre.

It provides visitors with the chance to browse “the history of humanity by means of glass” by viewing its private collection of over 3,000 pieces of glass and glassware. The exhibits are accompanied by photos, furniture and other decorative items that sit within each historical period represented.

The exhibits are accompanied by photos, furniture and other decorative items that sit within each historical period represented.

The museum aims to be not only a museum of objects and history but also a point of reference for artisan techniques from the past, many of which have been consigned to the history books, or museums just like this.

The museum is open Tuesday to Sunday, from 11am to 7pm. All tours are accompanied by a guide but there is no extra charge for this. If your group consists of more than ten people you may need to book in advance.

Visit their website for more information.

Trip Advisor Ranking – 5 (1,069 reviews)

5. Automobile and Fashion Museum (Malaga)

One of the largest collections of vintage cars in the world
One of the largest collections of vintage cars in the world

The Museo Automovilistico de Málaga is one of the more recent additions to Malaga’s list of things to do having opened in 2010. It is housed in one of the city’s most architecturally wonderful buildings, the old tobacco factory.

The museum houses the private automotive collection of Portuguese car fanatic Joao Magalhaes and its estimated value is around 25 million euros. It is claimed to be one of the most important, and significant collections of vintage cars in the world.

The display consists of more than 80 cars, both vintage and modern, alongside other travel-related memorabilia from the 1920’s through to the 1950’s.

Covering 6,000m² and with high ceilings and long thin windows, the museum is a great place to view these automotive artefacts. The display is split into ten sections, each covering a different era. These include Belle Epoque, the Art Deco 30’s, Dolce Vita 50’s and English Tradition, in addition to more modern themes including alternative energies, and tuning.

Like cars? Make sure you visit this museum. You won’t be disappointed.

Trip Advisor Ranking – 4.5 (1,216 reviews)

6. El Torcal Natural Park (Antequera)

Unusual rock formations at El Torcal Natural Park
Unusual rock formations at El Torcal Natural Park

El Torcal de Antequerra is a reserve of 17 square kilometres in the Sierra del Torcal mountain range, south of the city of Antequerra.

The park was designated as a Natural Site of National Interest back in 1929, but wasn’t declared a nature reserve until 1978.

The park is well known for its unusual rock formations and shapes. The limestone is about 150 million years old and time has shaped it, along with water and wind, to form strange “piles” of flat rocks, balanced impossibly on top of oneanother. Many have evolved into seemingly familiar shapes with some being nicknamed. You can look out for the Sphinx, the Jug, the Camel, and the Screw.

The area also includes caves and other underground formations. Some of these are of historical importance like the Cueva del Toro (Cave of the Bull) inside of which, Neolithic artifacts have been discovered.

Find out more on the official website.

Trip Advisor Ranking – 4.5 (970 reviews)

7. Celia Morales Traditional Flamenco Guitar (Ronda)

Celia Morales entertains with her flamenco guitar
Celia Morales entertains with her guitar

There isn’t much in the world that says Spanish Culture more than Flamenco Guitar and Flamenco Dancing. If you are visiting the coast, or any other part of Spain you should definitely try and see a show. I saw one in Granada a few years ago and it was very impressive. The effort and emotion that goes into Flamenco guitar is like nothing I have ever seen.

Celia Morales has been playing guitar since she was 8 years old before later studying classic guitar at Malaga’s Music School. In 1998 she decided to focus her efforts on Flamenco Guitar.

You can see Celia perform in a very small, intimate showing every day (except Sunday) from 19:30. The price is 15 Euros per person. You will be very close to the performer which will immerse you in the emotion and elegance of the flamenco style.

More information on Celia’s website.

Trip Advisor Ranking – 5 (242 reviews)

8. Alcazaba (Malaga)

The Alcazaba Fortification, Málaga
The Alcazaba Fortification, Málaga

The Alcazaba of Malaga palatial fortress originally built to deter pirates around 756-780AD.

Built on a hill in the centre of the city, it overlooks the port, and consists of two walled enclosures, or an inner citadel and an outer citadel.

Initially, it was also connected to the city ramparts forming a third defensive line but today only two inner walls remain. The first, built around the topography of the hill, completely encloses the second inner area and is dotted with defensive towers.

As you move through the fortress you will see a number of immaculately manicured gardens and elaborate fountains, in addition to simply stunning architecture. You will also be able to see beautiful arches, towers, gates, and original marble columns. There are also dungeons, a mosque and baths which are usually accessible.

The Alcazaba is open from 9am to 8pm although entrance is permitted only until 7:30pm. Entrance is only a couple of Euros so if you’re in Malaga you should definitely take a look.

More information here.

Trip Advisor Ranking – 4.5 (3,884 reviews)

9. Benalmadena Puerto Marina (Benalmadena)

Benalmadena Puerto Marina
Benalmadena Puerto Marina

Benalmadena Marina has twice been awarded the Best Marina in the World and when you see it you can understand why.

It is without doubt the most amazing port and residential complex in Europe with a mix of architecture from Indian, Arabic and Spanish cultures. Many of the structures sit on artificial islands which add to the allure of the area.

There is a huge array of shopping facilities and eateries catering for all appetites, all available to eat in the sun at the water’s edge. Can life get any better?

You will also find a casino, bars and clubs, in and around the marina with golf courses close by. The marina provides everything you need from leisure to entertainment to food and drink to shopping – enough to keep the most demanding visitor occupied.

The area has held a European Blue Flag for its beaches and water quality since 1987! More information can be found here.

Trip Advisor Ranking – 4.5 (3,443 reviews)

10. Cueva de Nerja (Nerja)

A cave large enough to host concerts
A cave large enough to host concerts!

Cited as one of Spain’s most popular and historically significant sites are the Nerja Caves – a series of large caverns covering almost 5km and housing the world’s largest stalagmite – a 32m  formation which measures a jaw-dropping 13 metres by 7 metres at its base.

The caves are split into three galleries – Show Gallery, Upper Gallery and New Gallery – each consisting of a number of Halls. Some of these halls contain prehistoric cave paintings but due to their delicate and important nature these areas have limited access.

The caves were discovered relatively recently, in 1959, by five local boys out hunting for bats. Not long after, in 1960, the caves were officially inaugurated and opened to the public.

The caves are open every day of the year except Jan 1st and May 15th. For 2016 some new guided tours have been introduced including The Secrets of the Caves, The Discovery Tour and a Night Tour.

Find out more here.

Trip Advisor Ranking – 4.5 (2,495 reviews)

So there you have it! This is only a tiny selection of things to do on the Costa del Sol. TripAdvisor lists over 500 activities and places to visit so get your bags packed and head on down here for the summer. You will not be bored!

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Russians Continue to Love Spain

Russians continue to visit Spain and the Costa del Sol in great numbers and most of them stay a while and spend spend spend!

Tourists from Russia top the league of tourism average expenditure with an average of 1,499 Euros per person, considerably higher than the national average of 1,056 Euros. This amount also dwarfs that of the Germans (959 Euros) and the Brits (895 Euros).

With an eye on maintaining the popularity of the region some Russian tour operators are already adding extra flights to Iberian airports from both Moscow and St. Petersburg. According to data from AENA the number of passengers travelling to Spanish airports from Russia increased 27.3% in February, when compared to the same month in 2015.

This shows a continuation of the increase we saw in 2015 when the number of Russian passengers arriving in Málaga Airport increased 17.62% (compared to 2014) to 71,523. Other than February and November 2014, the number of airline passengers from Russia to Spain has increased every month for the last two years.

Málaga / Costa del Sol

The main source of Russian passengers arriving in Málaga Airport was Moscow accounting for 50.7% of the total, while St. Petersburg accounted for 19.2% of passengers.

The travellers specified their main reasons for visiting the Southern region were the sun and beaches, leisure activities and entertainment, culture, shopping, and gastronomy; all of which epitomise the Costa del Sol and which attract millions of tourists from all over the world year after year.

The availability of direct flights to Málaga was also mentioned as an important reason for visiting.

More than half of Russian passengers (51.3%) said they had used a travel agency to organise their visit with 15.2% of those stating that it was arranged online via a travel website.

More than 4 out of 10 Russian tourists stated that they would stay in a hotel of four or five-star rating which may account for the increased average spend.

Time and Money

Russian spending remains high
Russian spending remains high

The average length of stay for Russian travellers is also slightly above the national average of nine days standing at 10.4 days, with more than half of all Russian visitors to Spain stating that they would or have visited Málaga / Costa del Sol. Most popular among those visitors were Marbella, Málaga, Benalmadena, Nerja and Fuengirola all of which received positive reviews.

When visiting the Costa del Sol, Russian tourists spent almost 25% more per day then other tourists, with an average daily spend of 61.7 Euros per day compared to 48.5 Euros for tourists from other countries.

When asked to rate aspects of the Costa del Sol, the average for overall satisfaction with the region was 8.7 out of 10. Many individual aspects, including landscape, environment, quality and prices, all received averages above nine out of ten. The worst rating was for the coasts taxis which received an average satisfaction rating of 7.1 out of ten.

In line with increases in passenger numbers across Spain’s airports the number of Russians arriving in Málaga airport increased by 24% in the first two months of 2016.

There are now up to 10% more airline seats available for flights to Málaga this year compared to 2015. This is in part thanks to Russian Airline Aeroflot increasing connections to the region.

 

Increase in German Visitors Expected

President of the Junta de Andalucía, Susana Díaz
Junta de Andalucía President, Susana Díaz

The world’s leading travel trade show took place in Berlin over the weekend and President of the Junta de Andalucía, Susana Díaz, was there on the opening day.

Díaz is reportedly “delighted” at the prospects for German tourism in Andalucia this coming summer following a very successful show.

In 2015 the number of German tourists visiting the region increased by almost 5% and this trend appears to be continuing as there has been a 12% increase in bookings compared to the same time last year.

Increased Demand

Over 1.2 million tourists arrived in Andalucia from Germany in 2015, a 4.8% increase over 2014. These visitors accounted for 800,721 hotel nights representing a 3.1% increase. The total of overnight stays by German tourists was a massive 3.8 million. This was a rise of only 0.6%; a small yet significant increase. The average length of a visit was 11.3 days, which is slightly over the Spanish average of nine days.

Two major tour operators, FTI and TSS Group, have both indicated that they have increased their capacity for Spain because they have seen a growth in demand.

Despite the numbers suggesting a good year, Díaz pointed out that the German market had not performed as well as expected in 2015, either in Spain as a whole, or in destinations such as the Costa del Sol and Malaga city, despite up to one third of German tourists visiting those areas. She added that Andalucia was keen to see an increase in German arrivals as they are the third nationality in terms of holiday spend.

“We have come to the ITB with two things in mind: to discover new trends and products which are popular with German tourists and to promote Andalucía as a holiday destination par excellence. We offer a very extensive variety of different facilities and this is what visitors require, so we have the potential for enormous growth,” Díaz said.

According to Díaz, German tourists are loyal to Andalucia and many return to the region year after year. “I am convinced that the figures this year will be higher than last year. Germany is a great ally in terms of tourism and a key market towards our aim of achieving 30 million tourists during this legislature,” she added.

Improved Connections

As a means of ensuring the arrival of more Germans this year Díaz explained that work is required to improve air connections between the countries as this is currently the “Achilles heel in this market” adding that there is a need for extra direct flights from German airports to Malaga, Seville and Almeria.

As a results of security scares and terror threats in other popular tourist destinations, including Turkey, Tunisia and Egypt, Andalucia plans to try and make the most of the extra interest in Spain. There has been a reported 40% drop in bookings to those areas. Díaz announced that they plan to invest 2 million euros to promote the area to capitalise on this with up to 50 promotional activities with a big push for Andalucian beaches, golf, health and cruises saying “We want the figures, which are already good, to become extraordinary,”.

Taylor Wimpey´s New Apartments Horizon Beach La Galera

Horizon Beach La Galera EsteponaAWARD WINNING UK property developer Taylor Wimpey is launching a fresh £10 million project on the Costa del Sol this month.

The La Galera development, in Estepona, is going to consist of thirty six luxury homes and is due to be formally launched with an opening on April 30th. Taylor Wimpey has constructed over two, 500 homes in España over the last fifteen years, as well as Los Arqueros Golf, in near  Benahavis.

“Estepona is a perfect location for further investment,” stated Ignacio Oslé, regional director in Andalucia. “We want to thank Estepona town hall for their support in getting planning permission last October.”

2 BED 2 BATH TOP LUXURY APARTMENT NEXT TO BEACH IN SAN PEDRO MARBELLA

2 BED 2 BATH AMAZING LUXURY APARTMENT NEXT TO THE BEACH IN SAN PEDRO MARBELLA – Ref: MFSA853

san_pedro

Price: 1,159,000€
The luxury resort of Casablanca Beach has a privileged location: frontline beach, next to a beautiful promenade lined with typical fish restaurants and wide beaches.

In this area there are future plans for a new Marina. A 15 minutes walk to downtown San Pedro de Alcantara and 30 minutes from Puerto Banus.

The resort enjoys the tranquility of the sea and is one step away from the entire infrastructure necessary for daily living such as shops, banks, restaurants, sports centers. With an original architecture in three heights, the complex has 61 apartments of 2 and 3 bedrooms. Ground floors and penthouses are duplex.

In its construction have been used first quality materials: marble, natural stone, wood. The apartments have built area from 204 m2 to 440 m2, with large terraces, 2 parking spaces and Jacuzzi in the penthouses. The communal areas have a beautiful lake-shaped pool and 6.000 sqm of tropical gardens with direct access to the promenade and beach.

View full property details and more photos

For more information or to arrange a viewing of this property please contact us using the details below.

Tel: +34 952 907 386 | Mov: 690 937 587
Property For Sale in Marbella
info@marbella-resales.com

1 Bed 1 Bath Townhouse, Aloha, Costa del Sol – GREAT PRICE

1 BED 1 BATH  TOWHOUSE – GREAT PRICE – Ref: MFSTH859

property

Price: 135,000€

Townhouse, Aloha, Costa del Sol.
1 Bedroom, 1 Bathroom, Built 85 m².

Setting : Mountain Pueblo, Close To Golf, Close To Port, Close To Shops, Close To Sea, Close To Town, Close To Schools, Close To Marina, Urbanisation.
Orientation : North, North West.
Condition : Excellent.
Climate Control : Air Conditioning, Hot A/C, Cold A/C.
Views : Mountain, Street.
Features : Covered Terrace, Private Terrace, Solarium, Satellite TV, Marble Flooring, Double Glazing.
Furniture : Not Furnished.
Kitchen : Fully Fitted.
Parking : Open, Street.
Utilities : Electricity, Drinkable Water.
Category : Bargain, Cheap, Golf, Holiday Homes, Investment, Resale.

View full property details and more photos

For more information or to arrange a viewing of this property please contact us using the details below.

Tel: +34 952 907 386 | Mov: 690 937 587
Property For Sale in Marbella
info@marbella-resales.com

The Luxurious Costa del Sol

Guest post by Heather Reid.

Whilst the Costa del Sol may conjure up images of mass tourism, many visitors are surprised to find that this region also boasts a wealth of exclusive and luxurious destinations. Spoil yourself with a luxurious road trip along the 100-mile coastline of the Costa Del Sol and enjoy a landscape that includes spectacular mountain scenery, views of the Rock of Gibraltar, the coast of Northern Africa and the Sierra Nevada Mountains.  Whether you drive along the coast or head inland, amongst the natural beauty and traditional villages, you will find luxurious resorts, fine dining, golf courses and some serious fun.

Luxurious Puerto Banus
Luxurious Puerto Banus

First of all, head to Puerto Banus, a luxurious resort built in 1970, just 6km from the town of Marbella, 64km south of Malaga.  Starting out as a luxury marina and shopping centre, today it is a major destination and a magnet for the super rich, with seemingly endless mega-yachts docked at the marina and streets chock-a-block with luxury cars.  Set against a dramatic mountain backdrop, you can’t help but be impressed by the glitz and glamour of this town.  Puerto Banus is always bustling and full of upmarket bars and restaurants, boutiques including D&G and Dior and a casino.  This is a prime party location, attracting a young, sophisticated and rich clientele whose main aim is to be seen.  There are some great restaurants, including the meat lovers’ delight, Tango or the celebrity hangout of the Red Pepper and some even better nightclubs such as the hugely popular and pricey Olivia Valere.

A few miles away from Puerto Banus is the exclusive town of Marbella.  A luxurious destination for rich European tourists, it successfully combines history and culture with flashy marinas, restaurants and beaches. Those who enjoy a bit of culture should try to get to a performance at the amphitheatre or enjoy an afternoon stroll through the historic old town, a charming place with cobbled streets, whitewashed buildings and outdoor cafes.  If however you prefer a day of pampering and partying, a visit to the exclusive Nikki Beach resort will be a highlight.  One of the most glamorous destinations in Marbella and a great way to enjoy the beach in style, try to make it for one of Nikki Beach’s ‘Amazing Sundays’ with DJ’s, live music, great cocktails and oodles of beautiful people.

If partying is not quite your thing, a short drive will bring you to Nueva Andalucia, also known as the ‘golf valley’.  With warm weather all year round, this region is perfect for golf and the exclusive Aloha Golf course should be at the top of your list.  Designed by Javier Arana, it is one of the best courses to play on in Spain.  Set within beautiful surroundings that have been lovingly landscaped, this is a well maintained golf course that most golfers will find an enjoyable challenge, whilst the terrace has amazing views and is a wonderful place to sit and enjoy a leisurely lunch.

And if it is natural beauty that you are looking for, you can’t go wrong with a trip to Benalmadena. The town is located around 20km from Malaga and boasts spectacular views across the coast from the top of the Calamorro Mountain. There is a cable car from the town that lifts you slowly up the side of the mountain, allowing you to enjoy breathtaking views as you rise 800 metres to the summit.  On a clear day you can see Gibraltar and the coast of Africa.

There are some truly luxurious options for accommodation on the Costa del Sol, including the hotel resorts of Gran Melia Don Pepe, just a few kilometres from Marbella or the Don Carlos Leisure Resort, right next door to Nikki Beach.  For something a little different there are a good selection of boutique hotels, including Hotel Claude, a charming 17th century townhouse in Marbella that has been refitted to combine exclusive modern design with the original features and the fashionable Marbella Heights Boutique Hotel, located on a hill above Marbella with stunning sea views and glorious surroundings.

With well-maintained roads, fast highways connecting the cities and major towns and plenty of wonderful scenic routes to travel, exploring the Costa del Sol by car is great fun and with companies now offering extremely competitive prices for car rental in Malaga and locations across the Costa del Sol, driving a luxury car is much more affordable.  With cars designed for extreme comfort and fitted with all the latest entertainment systems and safety features, it is likely that you enjoy the drive as much as the destination.

Heather Reid is marketing manager for Bingo Car Rental, specialists in low cost and luxury car rental in locations across Spain and Europe.

Huge wildfire raging towards Marbella

Raging along the coast
Raging along the coast

I’ve been too busy to write anything over the last few days but I had to pop on quickly to tell you about the fire.

I looked out of my bedroom window last night and saw the sky glowing red. Although the fire started in La Cala, about 15 km from my house, I could clearly see the flames whipping around in the wind. The sky was filled with smoke, bright red smoke.

It spread quickly because there was quite a wind last night. thousands of people have been evacuated and one old man was killed. Rescuers are searching for his wife.

The main toll road was closed for a while as the flames licked the hard-shoulder. Over 30 aircraft have been dropping water on it all day but it’s still going. It’s going to take a few days to get it under control because it’s still windy and it’s been so dry this year, and we’ve had a very hot summer.

It’s not the first wildfire this year, and it wont be the last. It happens often on the Costa del Sol because of the long, dry summers and the large areas of woodland and open fields, full of dead, dry grass. It only takes on cigarette butt or one spark from a camp-fire and it goes up in seconds.

A huge area has been destroyed
A huge area has been destroyed

You can see some of the devastation in the picture. I dread to think how much wildlife was killed just in the area pictured. I know someone who runs a kennel for rescue dogs and they were frantically calling people last night trying to get help moving the animals to a safe place.

Many of the evacuees spent the night in La Cañada, a shopping centre in Marbella. Some people were allowed back to there homes this morning but some are still waiting to hear when they will be able to return and inspect the damage.

It’s going to be a while until everything is back to normal, but for some people it never will. People have lost homes, cars, pets and personal belongings.

A few friends of mine were evacuated from Santa Clara, a nice development of townhouses close to Elviria, and others were told to be on standby.

It’s nasty and it’s not over yet.

They can’t always get what they want

It seems to me that whilst The Rolling Stones are getting satisfaction after 50 years of hard slog, Eurozone ministers are finding after a considerably less period of time “they can’t always get what they want” and the crisis rumbles on.

With the recently discussed bailout for Spain of around 100 billion euros and the immediately agreed 30 billion euros to help restore confidence in the Spanish banking system hopes were strong for the euro. However as we know nothing is free in life and Spain has had to reassure the EU that they can raise additional revenue so they increased VAT from 18% to 21% and of course further spending cuts are on the cards. With long term bond yields suffering in both Spain and Italy and the threat of Greece seeking new terms for their bailout confidence unfortunately in the zone is at the moment very low.

The UK cannot escape concern particularly with the LIBOR scandal still ongoing and the launch of the Funding for banks, it now remains to be seen if the banks will pass on this money to its clients and in doing so at what rate! One piece of good news for the UK however was the UK trade balance was lifted by exports and the trade deficit fell for the first time in 4 months.

The rest of the world also has many concerns, pace of growth in China and lets not forget the US where weaker global growth is starting to take its toll, watch out this week for results from many of the multi nationals, poor results could open up a can of worms.

Moneycorp

Moneycorp – costadelsol@moneycorp.com or telephone +34 951 319 700

Spain and the Euro

Will the Euro survive?
Will the Euro survive?

Headlines such as “Catastrophe in Spain”,”the worst since Franco times”, and “pain in Spain” have been the main focus during the last couple of weeks and of course, it in turn generates fear and uncertainty so the euro and its currency has taken a bit of a battering. It is worth however reminding ourselves of what has been happening elsewhere.

In the UK, the inflation report for May did not make particularly good reading as the Bank of England’s main forecasts went against them. They had to revise downwards the economic growth number for 2012 from .8% to 1.2% and retail sales also hit a rough time in April as they fell to its lowest since 2010. On the plus front unemployment fell to 8.2% and inflation also fell so a bit of welcome news for all. We also know that the Bank of England decided inflation was still one of its main issues so at this moment decided against further money printing.

Looking at the eurozone we have seen lots of conflicting data and whilst some has been negative there is always a balance. The Purchasing Managers’ Index (PMI) fell for the 4th consecutive quarter due to weaker business activity and new orders, manufacturing also fell to unfortunately near a 3 year low. The eurozone did however manage to avoid a recession but data suggests that the next quarter will be much more difficult. Germany once again being the lynchpin for the zone as unemployment fell, bond yields all time low and retail sales figures rising for the second month, sounds like the good ole days!!

There are two main areas of concern right now and that is, what will happen at the forthcoming Greek election and what impact that will have on the euro. Will they stay or will they go (must be a song in here somewhere) and of course Spain and the ever deepening saga over its banking strength. The latter highlighted very much by Spain’s 4th largest bank Bankia which need a capital injection to keep it going and whilst the Spanish government stands very much behind it and wants to help, how it is going to find around 19 billion euros is still the main question. Bond yields in Spain have also been perilously high and the rate now seems to be settling around 6.5% a huge price to pay for raising money. Rumours are also out there that Spain will need a bailout of around 100million euros to keep it alive, sounds a lot on money and of course it is but remember it wasn’t that long ago that the British taxpayer had to foot the bill for the Royal Bank of Scotland and that alone cost around 45.5 billion or c60 billion euros. Lets see if Spain will accept the suggestion from the ECB that it should accept a loan package.

Going forward the key issue will be trying to restore confidence in the eurozone and its currency so that investors feel they do not need to switch to dollars. It seems also that the EU has learnt a little from history in accepting all comers into the euro as it has recently advised 8 countries under review that none meet the required standards for entry.

Impact upon exchange rates has been considerable as the euro has lost ground against both sterling and the dollar or put another way, your pound is now worth more euros.

If you want to know more contact Moneycorp by emailing costadelsol@moneycorp.com or telephone them on +34 951 319 700

Moneycorp