Article Image
News Link • Economy - International

Spanish yields spike as crisis exits blocked


European Union paymaster Germany continues to block the two most widely-touted exit routes from a deepening crisis that is shaking the world economy -- massive European Central Bank intervention to buy government bonds, or joint issuance of euro zone debt.

Influential ECB policymaker Jens Weidmann, head of Germany's Bundesbank, spelled out his rejection of the former in a speech to employers in Berlin.

"(The ECB) would overstretch its mandate and call into question the legitimacy of its independence by accepting a role of lender of last resort for highly indebted member states," Weidmann said.

"Whoever believes that the current crisis can be overcome by giving up crucial principles of stability orientation, pushing current legislation aside, is wrong," he said, adding he did not believe either Spain or Italy would need financial rescues.

Average yields on Spanish 3- and 6-month treasury bills soared by around 2 percentage points in an auction seen as a test of investor sentiment after the conservative People's Party won an absolute majority in Sunday's general election.

Join us on our Social Networks:


Share this page with your friends on your favorite social network: