Saturday, August 4, 2012

Interest rate for key Spanish bond soars

MADRID (AP) ? Spain's borrowing costs are back on the rise again as investors continue to show their disappointment in the European Central Bank's warning that it would only help the country if it applied for rescue aid.

The interest rate, or yield, on Spain's benchmark 10-year bond shot up 0.14 percentage points to 7.21 percent in the first hour of trading Friday. Such a rate is unsustainable over the long term and could likely push Spain to seek a bailout.

The benchmark Ibex 35 stock index was down 0.5 percent. It shed nearly more than 5 percent Thursday after the ECB's announcement.

Spain's 10-year yield had edged down to 6.5 percent last week after ECB chief Mario Draghi first intimated he would apply measures that would help ease the pressure on borrowing costs.

Source: http://news.yahoo.com/interest-rate-key-spanish-bond-soars-082540279--finance.html

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