BRUSSELS (MNI) – European Commission President Jose Manuel Barroso
expressed “deep concern” Wednesday over the recent developments in
Italian and Spanish sovereign debt markets and urged Eurozone
governments to implement the measures agreed to late last month “without
delay”.
The recent record highs in Italian and Spanish debt “are clearly
unwarranted on the basis of economic and budgetary fundamentals in these
two member states and the steps that they are taking to reinforce those
fundamentals,” Barroso said.
Barroso noted the “unique solution” that was found in late July,
when Eurozone heads of state agreed to “groundbreaking measures” to
resolve the crisis and highlighted that the “necessary technical work”
was “already underway”.
However, ongoing tensions in bond markets show that there is a
“growing concern” among investors of the Eurozone’s capacity to deal
with the situation, he acknowledged.
“It is essential, therefore, that we move forward rapidly with the
implementation of all of that has been agreed by the heads of state and
government and send an unambiguous signal of the euro area’s resolve to
address the sovereign debt crisis with the means commensurate with the
gravity of the situation,” he said.
Barroso comments come as the yields on Spanish and Italian 10-year
bonds continued to trade at levels considered unsustainable by analysts.
Although a few basis points tighter than Tuesday, Italian and
Spanish spreads are still hovering around record levels against German
bunds. Yields on benchmark 10-year Spanish and Italian bonds peaked
Tuesday at 6.45% and 6.25%, respectively.
— Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —
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