Spanish take to streets in protest as MPs pass €65bn austerity package

From The Guardian UK:

Spain’s cost of borrowing hits record high as Germany approves potential bond-buying with leftovers from €100bn banks bailout

in Madrid and Brussels, Thursday 19 July 2012

Protesters took to the streets of 80 Spanish cities on Thursday night after prime minister Mariano Rajoy’s People’s party (PP) pushed a €65bn (£51bn) austerity package through parliament and the country paid record prices to borrow money from sceptical markets.

More than 100,000 people were estimated to have joined in demonstrations called by trades unions, with about 50,000 gathering in Madrid. Police fired rubber bullets to disperse the protesters in Madrid.

Angry civil servants had blocked traffic in several main Madrid avenues earlier in the day, with protesters puncturing the tyres of dozens of riot police vans, amid growing upset at austerity, recession and 24% unemployment.

Rajoy was able to get the measures through parliament comfortably, using only the votes of PP MPs.

The finance minister, Cristóbal Montoro, who warned on Wednesday there was no money for civil service wages, said Spain could not go deeper into debt. “Financing public services with more deficit and more debt will doom us,” he said.

Proof of Spain’s growing financing problems came when it paid a record interest rate of 6.459% to sell five-year bonds, while rates on 10-year bonds rose back above the unsustainable 7% level.

France paid less than 1% for similar five-year bonds as investors shunned southern economies for what they saw as the eurozone’s safer core.

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