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No change from ECB or Spain

Thursday, November 08, 2012 - 02:04

Nov. 08 - While the ECB said the outlook was bleak for the euro zone, Spain had success with its borrowing costs but is it enough to avert asking for a bailout? Joanne Nicholson reports

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No surprises from Mario Draghi - the ECB chief held interest rates at a record low. He doesn't think the economy will pick up any time soon. (SOUNDBITE) (English) EUROPEAN CENTRAL BANK CHIEF, MARIO DRAGHI, SAYING: "Most recent survey evidence for the economy as a whole extending into the fourth quarter does not signal improvements towards the end of the year. Looking ahead to the next year the growth momentum is expected to remain weak." Ironically, another successful Spanish bond sale didn't help. The ECB hasn't yet had an excuse to trigger its bond purchase programme - its trump card for calming the markets. Spain remains at the centre of the euro zone crisis as it battles to control its public deficit. Tom Vosa, from National Australia Bank, says it won't get a better offer from the ECB. SOUNDBITE (English) TOM VOSA, HEAD OF MARKET ECONOMICS, NATIONAL AUSTRALIA BANK, SAYING: "The fact that the ECB are telling you that they're by enlarge done with Greece, it's up to governments, they really hinting to the Spanish government, don't look to us for any more help if things worsen - you'll now have to continue with the reform measures, ask us formally for an OMT, which of course means asking the ESM for a loan and letting the IMF and the EU commission look over your government books and perhaps suggest some more reform measures where we think you're slipping behind." There've been more protests in Spain this week and a general strike is planned for next week, The Prime Minister says he expects Spain's economy to grow in 2014. He also fears the ECB's programme may not bring Spain's debt costs down. Salvador Isasa is from Inversis Bank. (SOUNDBITE) (Spanish) ANALYST AT INVERSIS BANK SALVADOR ISASA SAYING: "The fight is now about whether the bailout should be Greek-style or Spanish-style. We do not have clarity on how such a bailout would be and we are not clear on whether it would have the approval of 100 % of the regional states." Meanwhile, Spaniards are growing increasingly impatient with the harsh austerity measures being implemented. And many think it's a matter of when, not if, Spain asks for a bailout.

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No change from ECB or Spain

Thursday, November 08, 2012 - 02:04

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