EU Economic and Monetary Affairs Commissioner Olli Rehn made a statement on Spain on Wednesday, regarding the country's deficit moves. According to the European Commission's assessment the Spanish government has taken effective action for 2012, 2013 as far as restoring sustainability of public finances is concerned. Nevertheless, it would fail to meet the deficit target for 2014.

Mr Rehn declared that Spain currently does not need additional measures and that the progress of its budget consolidation will be evaluated once again by the EU in February, by which time it might be necessary to introduce further measures. He added that he does not see the need for Rajoy's government making a bailout request in the nearest future.

The EU Economic and Monetary Affairs Commissioner also acknowledged that Spain is currently undergoing difficult rebalancing of the economy and that its government and people are making great efforts to assure sustainability of the country’s finances.

1st Pan-European General Strike under way

Workers from several European countries took to the streets today in the biggest ever coordinated strike action in order to protest against the harsh austerity measures implemented by national governments in response to the financial crisis.

Spain, Portugal, Greece, Italy, France, Belgium and the UK are all holding strikes today but only in Spain and Portugal full general strikes were organized. Transport services have been disrupted, hundreds of flights canceled and offices and factories remained shut for the day or witnessed several hour stoppages. Protesters in Spain and Italy clashed with the police.

The European Trade Union Confederation (ETUC) which has organized the strikes explained in an official release that the austerity measures implemented by governments across Europe “only serve to worsen imbalances and foster injustice.”

Italian borrowing costs drop at auction

Italy held a debt auction today during which it managed to sell 5 billion euros worth of government bonds.

The Rome-based Treasury sold 3.5 billion euros worth of 3-year bonds at an average yield of 2.64%, in comparison with 2.86% seen at the previous auction. 1.5 billion euros of BTP's maturing in August 2023 and November 2029 were auctioned at average yields of 4.81% and 5.33%, respectively.

Following the auction Italian 10-year bond yields fell to 4.96%.