German finance minister rejects talk of Spain aid request
July 29, 2012, 12:05 am TWN
BERLIN--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.
Still, German Finance Minister Wolfgang Schaeuble was quoted as telling the Welt am Sonntag newspaper that Spain's short-term financing needs are "not so big."
Asked about talk that Spain could soon make an application for the eurozone rescue fund to buy bonds, he replied: "There is nothing to this speculation."