Spain aid could be firewall boost, ECB action: France

PARIS Tue Jul 24, 2012 3:01am EDT

Spain's Foreign Minister Jose Manuel Garcia-Margallo (L) welcomes his French counterpart Laurent Fabius after his arrival for a meeting at the Foreign Ministry in Madrid July 20, 2012. REUTERS/Andrea Comas

Spain's Foreign Minister Jose Manuel Garcia-Margallo (L) welcomes his French counterpart Laurent Fabius after his arrival for a meeting at the Foreign Ministry in Madrid July 20, 2012.

Credit: Reuters/Andrea Comas

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PARIS (Reuters) - French Foreign Minister Laurent Fabius said on Tuesday that further aid for Spain could take the form of an increase in Europe's rescue fund or action by the European Central Bank, though he hoped neither option was necessary.

"I hope it will not be necessary to intervene again," he told France 2 television. "If we have to intervene, it could be an increase in the firewalls ... or interventions by the (European) central bank."

"The president of the central bank has said, and it's a statement that we should not take lightly, that he has no hang-up about interventions."

Worries that Spain may have to appeal for a full-fledged international bailout, on top of its request for 100 billion euros to recapitalize its ailing banks, have pushed Spanish borrowing costs up to euro-era highs in recent days.

(Reporting By Nicholas Vinocur)

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