Merkel's popularity hit by euro crisis

Chancellor Angela Merkel's popularity plummeted by 10 per cent in May to its lowest level in more than four years because German voters feel she had handled the euro crisis badly, an opinion poll showed yesterday.

The survey conducted by the ARD television channel gave Germany's first woman leader a popularity rating of 48 per cent. The result represented a 10 per cent fall over April and a 30 per cent drop over the past six months. Sixty four per cent of those questioned said they thought the German government's €148bn (£125bn) rescue package for the single currency was wrong. Only 31 per cent approved of the measures.

The poll also showed that the popularity of Ms Merkel's coalition of conservatives and liberal Free Democrats had sunk to a new low with both parties polling 40 per cent compared to 43 per cent for the opposition Social Democrats and Greens. Ms Merkel's party was trounced in a recent key state election in early May and her government has lost its majority in Germany's upper house of parliament as a consequence.

* Spain's financial problems worsened yesterday when Fitch downgraded its credit rating from AAA to AA . A spokesman said that Prime Minister Jose Luis Rodriguez Zapatero's efforts to close the country's budget deficit "will materially reduce the rate of growth of the Spanish economy over the medium term".