Spain does not need full bailout: economy minister

MADRID - Agence France-Presse

Spain's Economy Minister Luis de Guindos pours himself coffee at the start of a parliamentary hearing at the Spanish parliament in Madrid July 23, 2012. REUTERS Photo

Spain does not need a full bailout, the economy minister said Monday even as its long-term borrowing costs soared dangerously higher and figures showed the economy shrinking even faster.
 
Asked by journalists if he ruled out the possibility of a full bailout, after a 100 billion euro EU deal on the banks was agreed Friday, Luis de Guindos said: "Of course." "In this period of uncertainty, of volatility, there is an irrational atmosphere (on the markets)," de Guindos said.
 
"The only way to act goes well beyond the capacity of (individual) governments," he added, apparently referring to calls for the European Central Bank to play a wider role in resolving the eurozone debt crisis.
 
The minister was speaking as Spanish 10-year borrowing costs soared to 7.5 percent, well above the 7.0 percent level which forced Greece, Ireland and Portugal to seek full EU-IMF bailouts.
 
With speculation mounting that Madrid will need more aid beyond Friday's bank bailout accord, investors were selling down the bonds and stocks of weaker eurozone markets on Monday, adding to the pressures.