EU Commission May Agree for Spain to Cut Deficit More Slowly

The European Commission may give Spain more time to meet budget-deficit rules as the country battles a deepening recession.

Commission officials “are ready to consider proposing an extension of the deadline to correct the excessive deficit by one year to 2014,” said Economic and Monetary Affairs Commissioner Olli Rehn during a news conference in Brussels.

Spain has the third-largest budget gap in the euro zone, comparable to Greece’s. Prime Minister Mariano Rajoy today repeated a call on European authorities to support his government’s efforts as the yield on Spain’s 10-year benchmark bond jumped 22 basis points to 6.67 percent.

Economy Minister Luis de Guindos today said that the yield premium investors demand to hold Spanish 10-year debt over similar maturity German bonds, which reached a euro-era record 540 basis points today, isn’t sustainable.

Read Full Article from Bloomberg

- Posted: 2012-05-30 14:22:46

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