After Greece, Spain is at the center of speculation - June 16, 2010
Spain is she about to ask for help from the EU? Despite repeated denials, the new back strongly in the German press. Monday, Frankfurter Allgemeine Zeitung asserted that the issue should be discussed in Brussels this week, without even waiting for the summit of Heads of State and Government scheduled for Thursday. The newspaper said the European Commission President Jose Manuel Barroso and Trichet Jean-Claude Trichet would have voted in favor of aid to Madrid. Friday already, the Financial Times Deutschland said that Brussels was expected to receive a Spanish demand in the months to come.
Claims denied on all sides. "Spain does not need additional funding from any international institution whatsoever.The rumor is false, said Monday the Treasury Secretary Carlos Ocana in Spanish, while recognizing that the Spanish banks struggled to refinance themselves abroad.
German game condemned
In Brussels, the Commission does not hide his irritation deal with rumors. "There is no preparation, there are no plans to provide financial assistance to a member country," said a spokesman. Although in theory "everything is in place" to run the financial stabilization mechanism of 750 billion euros finalized recently.
Spain adopted in late May an austerity plan of 50 billion euros by 2013. But the plan was narrowly passed by Parliament, and it is pale in comparison to 80 billion euros in savings in turn announced by Berlin pay day loans."Somebody in Germany has clearly beneficial to put more pressure on Spain, it's pretty twisted," says a source close to the Commission. In early June already, the Ecofin had requested additional efforts in Madrid.
Figure rumors
In Berlin, the Ministry of Finance wanted to calm things down by saying that Spain did not qualify to seek assistance from the Fiscal Stabilization Fund. Spain has played "no role" in a teleconference Monday for the finance ministers of G7 countries, devoted to preparations for the G20 summit in Toronto, has ensured a spokesman.
Still, the risk premium on bonds was tense Spanish Monday. "Again, there is a pattern of rumors as it was to know about Greece, it has been criticized diplomatic sources in holding that" we must beware of self-fulfilling expectations.Spain worried because it represents nearly 12% of European GDP: the euro area can not afford to drop it. But given the poor state of Spanish banks, some believe that the money from the stabilization fund would actually fly to the rescue of financial institutions.
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