Reuters - Video

Edition: US | UK | IN | CN | JP

video Finance Videos

Sceptisms over Spain banks package

Tuesday, July 10, 2012 - 02:01

July 10 - Euro zone ministers struggle to reassure financial markets that an aid package for Spain will help stabilise the currency bloc - a task made all the harder by a German legal challenge to its crisis-fighting tools. Joel Flynn reports

▲ Hide Transcript

View Transcript

Spain's index was slightly up after EU ministers gave it more time to cut its deficit. But investors are tiring of the predictable and repeated euro zone script. Madrid has been given an extra year until 2014 to cut costs. Barclays Henk Potts said the meeting was a step in the right direction but more needs to be done. (SOUNDBITE) (English) BARCLAYS WEALTH STRATEGIST, HENK POTTS, SAYING: "There are some far reaching areas that they really need to be focussing on in order to calm market nerves. This includes how to stimulate more growth in the euro zone, generate job opportunities and as we've said many times before, to generate a credible pathway to fiscal union, and that is at the point at which I think markets will be calm." In Germany, finance minister Wolfgang Schaeuble warned the country's top court that significant delay in approving the agreed bailout scheme could also fuel market turbulence. It's currently deciding whether the bailout is compatible with German law. A delay of more than a few weeks could have serious implications. UBS' George Magnus says that though markets have priced in downside risks, things could still get worse. (SOUNDBITE) (English) UBS SENIOR GLOBAL ECONOMIST, GEORGE MAGNUS, SAYING: "There are all sorts of things that could go wrong which I think markets find really, really difficult to price, so the markets are feeling a little bit kind of slouchy, a little bit kind of off colour now in the wake of the last European summit, but I think that if things really did go badly wrong in Europe then I think the markets could have a long way to fall still." EU finance ministers signed off the Spain deal on Tuesday. It also gives the country's troubled banks direct access to up to a 100 billion euros of bailout funds. Spain's Finance Minister said it was a real chance to "heal the sector" But ministers know they still need to do more to deepen economic integration across the region. Joel Flynn, Reuters.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Sceptisms over Spain banks package

Tuesday, July 10, 2012 - 02:01