SPAIN: Spanish PM Mariano Rajoy says Spain will be unable to fund itself at current prices and announces he will ask European Leaders to stabilize markets with existing European Union instruments
Record ID:
831020
SPAIN: Spanish PM Mariano Rajoy says Spain will be unable to fund itself at current prices and announces he will ask European Leaders to stabilize markets with existing European Union instruments
- Title: SPAIN: Spanish PM Mariano Rajoy says Spain will be unable to fund itself at current prices and announces he will ask European Leaders to stabilize markets with existing European Union instruments
- Date: 28th June 2012
- Summary: MADRID, SPAIN (JUNE 27, 2012) (REUTERS) VARIOUS OF SPANISH PRIME MINISTER MARIANO RAJOY ARRIVING AT PARLIAMENT
- Embargoed: 13th July 2012 13:00
- Keywords:
- Topics: Finance,Domestic Politics
- Reuters ID: LVA1BJC79LTKJWC4NVKTT48CIR9B
- Story Text: Spain's Prime Minister Mariano Rajoy said on Wednesday (June 27) he would ask other European Union leaders at a summit this week to use existing EU instruments to stabilize financial markets.
Speaking in parliament before a meeting of European heads in Brussels on Thursday (June 28) and Friday (June 29), Rajoy said access to financial markets was Spain's top priority and warned it would not be able continue financing itself at current yields for a long time.
"I will speak about the need to take measures to stabilize financial markets using existing EU instruments. With the current behaviour of premium risks in Spain and other countries, it is very difficult for the economy to grow," Rajoy said.
"We can't keep funding ourselves for a long time at the prices we're currently funding ourselves," he added.
As Rajoy was speaking in parliament the spread between the Spanish bond and its German equivalent to 10 years rallied about 10 basis points to 537 basis points.
At 0910 (7.10gmt), the Ibex-35 was falling 0.76 percent.
The funding of Spain's debt has been seen as unsustainable in the last few weeks with the spread between the Spanish bond and its German equivalent reaching historic levels.
Spain officially requested international aid for its banks on Monday (June 25) after two independent audits last week put the Spanish banks' capital needs in a stressed scenario at up to 62 billion euros.
Some market economists believe it is merely a prelude to a full bailout for the Spanish state, which saw its borrowing costs to soar to euro era record levels above 7 percent early last week, although they have eased to below 6.50 percent. - Copyright Holder: REUTERS
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