No risk of Spain needing bailout: finance minister

17th November 2011, Comments 0 comments

Finance Minister Elena Salgado said Thursday there was no risk that Spain would need to be bailed out to shore up its public finances.

Spain is "absolutely not at risk of a bailout," Salgado said on Cadena Ser radio, after the government's borrowing costs rose to the highest levels since the introduction of the euro.

In an auction of 10-year bonds on Thursday, Spain's Treasury had to pay 6.975 percent -- near the 7.0 percent rate that is considered unsustainable over the long-term -- to raise 3.563 billion euros ($4.8 billion).

Spanish government 10-year bonds were meanwhile trading at 6.75 percent -- the highest since May 1997 -- on the secondary market.

The debt risk premium -- the extra rate charged on Spanish 10-year government bonds compared to safe-haven German bonds -- jumped to a euro-era record of 4.99 percentage points.

"It is true that the markets are nervous but the sustainability of our debt is beyond all doubt," Salgado said.

© 2011 AFP

0 Comments To This Article