Prime Minister Mariano Rajoy has said he would not take a decision on whether to
apply for a new aid package, on top of a €100bn loan for the country's banks,
until he knew what conditions would be attached. Possible options would be for
Spain to apply for a precautionary credit line or to petition the European
rescue fund to buy Spanish sovereign bonds to force down yields. European
Central Bank President Mario Draghi earlier this month laid out plans. The yield
on Spain's benchmark 10-year government bond , dropped on Friday to 6.49
percent, its lowest level since early July, as banks took the bonds for use as
collateral to raise funds. Rajoy has slashed public spending and hiked taxes in
an effort to deflate one of the euro zone's largest public deficits and convince
nervous markets, which have pushed borrowing costs to 14-year highs, he can
control the country's finances. Botella was made mayor after the conservatives
came to power in December and her predecessor was named to Rajoy's cabinet. She
said she blamed the previous Socialist government for leaving the country with a
massive public account shortfall and leaving Rajoy no choice but to seek
international aid. Source: Reuters
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Spain wil fall under the German boot as well...
Prime Minister Mariano Rajoy has said he would not take a decision on whether to
apply for a new aid package, on top of a €100bn loan for the country's banks,
until he knew what conditions would be attached. Possible options would be for
Spain to apply for a precautionary credit line or to petition the European
rescue fund to buy Spanish sovereign bonds to force down yields. European
Central Bank President Mario Draghi earlier this month laid out plans. The yield
on Spain's benchmark 10-year government bond , dropped on Friday to 6.49
percent, its lowest level since early July, as banks took the bonds for use as
collateral to raise funds. Rajoy has slashed public spending and hiked taxes in
an effort to deflate one of the euro zone's largest public deficits and convince
nervous markets, which have pushed borrowing costs to 14-year highs, he can
control the country's finances. Botella was made mayor after the conservatives
came to power in December and her predecessor was named to Rajoy's cabinet. She
said she blamed the previous Socialist government for leaving the country with a
massive public account shortfall and leaving Rajoy no choice but to seek
international aid. Source: Reuters
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MADRID—The Spanish government would like to see the European Central Bank commit to massive, open-ended sovereign-debt purchases before it asks for help financing itself, Finance Minister Luis de Guindos said, as expectations mount that the country will ask for a new bailout.
The ECB earlier this month signaled that it would consider intervening if Spain asks the European Financial Stability Facility, the euro-zone's temporary bailout fund, for aid and enrolls in a formal program. The Spanish government has said it will decide whether to make such a request after the ECB provides more details on the type of support it would offer. This information could come after the central bank's Sept. 6 policy meeting.
Mr. de Guindos's comments to Spain's state-owned news agency EFE, confirmed by a Finance Ministry spokeswoman, gave the most explicit indication to date of what his government is looking for.
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