Spanish government will not request any financial rescue throughout 2012

FXstreet.com (Barcelona) - According to Spanish government officials, President Mariano Rajoy will not ask for any financial help during the rest of the present year. The ECB would have approved the decision already.

The news just confirm the previous reluctance showed by Rajoy, when he stated in previous comments that the Mediterranean country could still wait before asking for help, ruling out any request before the next year.

With the country’s debt issuance almost covered for the present year plus not-so-bad results in domestic fundamentals as of late and the banking union oriented in the right direction, the decision by the Spanish government seems to be well supported.

Furthermore, ECB’s Ewald Nowotny has commented that Spain would not need to ask for financial aid at the moment, hinting that the ECB was up-to-date about the decision.

All in all, the government has left the door open for a probable request in the future, however it won’t be soon.

Spanish CDS gave away some bps towards 413 soon after the news, a hair lower than yesterday’s 419 bps, while the 10yr benchmark bond orbits around 5.6%. The IBEX35 is up 0.78% as of writing.

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