EURO GOVT-Bunds rise after Spain says in no rush to seek aid
LONDON, Sept 24 |
LONDON, Sept 24 (Reuters) - German Bund futures rose on Monday after Spain's economy minister Luis de Guindos said over the weekend that his country will not rush to seek external aid to finance its debt.
Such a move would activate the European Central Bank's new bond-buying programme, which many analysts consider a powerful tool against the euro zone debt crisis.
But European officials also said they did not expect Spain to seek an assistance programme before a regional election in the Galicia region on Oct. 21. Paymaster Germany said on Friday that Spain did not need a European bailout.
At 0603 GMT, Bund futures were 27 ticks higher on the day at 140.27. The contract fell in the previous session amid growing speculation in the media and among investors that Spain was preparing for a bailout.
"Overall it's the classic binary outcome week. Either Spain does take the bailout or it doesn't," said Gary Jenkins, director at Swordfish Research.
Moody's Investors Service is expected to conclude its Spanish credit rating review by the end of the week and may downgrade the sovereign into "junk" territory.
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