ECB VP Constancio Tells Portuguese Radio Spain to Make Formal Request for Bank Aid
According to SkyNews, European Central Bank Vice President Constancio has hinted that Spain will formally request aid to help recapitalize its banks. He is quoted as saying "everything is possible" when asked whether aid request can come on Saturday. Risk assets have taken a leg up on the news, but there are still lots of questions surrounding the exact mechanism for the distribution of the funds.
Hopes had been rising over the past week that Spain was set to ask for help in recapitalizing its distressed banking sector, but Spanish officials attempted to quell such rumors earlier today. Now, the questions becomes how is the bailout funding going to be dispersed and monitored, and who will be in charge of managing the interests of the ECB?
These comments come after weeks of back and forth from Spain, as traders have been hoping for some form of ECB bailout of the Spanish banks for some time now. The Euro (NYSE: FXE) has firmed on the news and stocks (NYSE: SPY) have taken another leg up. The S&P 500 is up 7 points on the day, or .55%, after being down the same amount earlier today.
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