Euro Steady At $1.36 As Recovery Falters

The euro declined on Friday, trading at $1.3606 at 6:00 GMT after losing ground on Thursday following news that Portugal's Banco Espirito Santo was in trouble. The Portuguese Bank's shares were pulled from the market after losing 17 percent on Thursday due to solvency issues. So far this week, the bank has fallen 32 percent as it struggles with accounting difficulties from Espirito Santo International, its parent company. The problems in Portugal served to remind investors of the banking issues in Southern Europe, dragging down the markets in places like Spain and Italy. The spreading lack of confidence across the southern eurozone nations serves to underscore the divide between the bloc's northern economies like Germany, Finland and the Netherlands and southern members like Portugal and Greece. However, Germany, typically the region's powerhouse economy, is starting to feel the effects of the stalling recovery. Reuters reported that Germany's economic ministry warned investors that the conflict in Ukraine was taking a toll on confidence in Germany. The ministry said it expects growth in the second quarter to be “subdued”, something that will likely drag down the entire bloc's GDP. Analysts are expecting to see growth of around 0.2 percent for the eurozone in the second quarter, but the deterioration in Germany could take those figures lower. If German data continues to worsen it could be a sign that the bloc's recovery is slowly coming undone. The latest figures will likely put more pressure on the European Central Bank to do more to kick start the region's recovery.