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Less investor pain in Spain?

Monday, June 27, 2016 - 01:48

Spain's borrowing costs slide over 10 basis points, as gains for the centre-right People's Party in elections raise hopes of an end to the political deadlock and soothe peripheral markets sent reeling by last week's Brexit vote. David Pollard reports.

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Mariano Rajoy - Popular Party leader and for some, Spain's Mr Reform. On this occasion, Mr Romantic. (SOUNDBITE) (Spanish) ACTING PRIME MINISTER MARIANO RAJOY, SAYING: "I have to thank everybody - all those joining me here. I can't name them all - I am only going to name my wife." If a kiss is worth a thousand words, votes are even better. Spain's main centrist party now the biggest in parliament after picking up 14 extra seats in Sunday's election. And, it says, in a position to form a government - if needs be, in coalition. (SOUNDBITE) (Spanish) ACTING PRIME MINISTER MARIANO RAJOY SAYING: "I extend my hand to the moderate parties so that together we can do what Spaniards have asked for." The result has driven peripheral borrowing costs down. And the second-largest party, the Socialists - despite losing five seats - are paying some lip service to the idea of at least not opposing Rajoy. And after an already inconclusive election in December, the pressure is on ... Spain's biggest newspaper calling for party differences to be put aside - amid an uncertainty heightened by Britain's Brexit vote. IHS GLOBAL INSIGHT, DIRECTOR OF SOVEREIGN RISK, JAN RANDOLPH, SAYING: "People sense that they would like to stick with stability, and I think you can take that from the Spanish elections. Rajoy has increased his number of seats - OK, it's not a majority - but he can point to a legitimacy to carry on as a minority government." In the process, this party getting left behind. The anti-austerity, anti-EU Unidos Podemos slipping in the vote and failing to meet expectations it would emerge as the biggest left-wing party - that easing fears over the rise of populism across Europe. Its name in Spanish means 'Together We Can'. But this time, it couldn't quite - leaving its supporters in need of consolation rather than romance.

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Less investor pain in Spain?

Monday, June 27, 2016 - 01:48