Germany Rejects Idea of Buying Spanish Bonds

AP | Jul. 28, 2012, 7:55 AM

A demonstrator spraypaints the main door of the stock exchange during a general strike in Barcelona, Thursday, March 29, 2012. Spanish unions angry over economic reforms are waging a general strike, challenging a conservative government not yet 100 days old and joining other troubled European workers in venting their frustration on the street.

BERLIN (AP) — Germany’s finance minister is rejecting talk of a possible application from Spain for the eurozone’s bailout fund to buy the struggling country’s bonds, a newspaper reported Saturday.This week, European Central Bank head Mario Draghi promised to do “whatever it takes” to preserve the euro. The German and French leaders then said that they were “determined to do everything to protect the eurozone.”

Neither mentioned any specific action. But those comments raised expectations that the ECB — or the eurozone’s temporary rescue fund, the European Financial Stability Facility — might step in to buy Spanish government bonds and lower the country’s borrowing costs, which have been at worryingly high levels in recent weeks.

Read the rest of the article here: Business Insider


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