EURO GOVT-Spanish yields rise as Rajoy faces call to resign

LONDON Mon Feb 4, 2013 3:21am EST

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LONDON Feb 4 (Reuters) - Ten-year Spanish government bond yields rose on Monday as the country's opposition party called for the resignation of Prime Minister Mariano Rajoy over a corruption scandal.

Ten-year Spanish government bond yields rose 11 basis points to 5.32 percent, with data showing the number of people out of work rose by 2.7 percent in January from a month earlier also adding to the momentum.

Ten-year Italian government bond yields also rose on concerns that a scandal involving Monte Paschi bank could see a rise in the popularity of the centre-right party in the polls, whose election charge is being led by former prime minister Silvio Berlusconi.

Italian yields rose 9 bps to 4.42 percent.

"It's that worry of political instability in both Spain and Italy," a trader said.

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