Spain’s unemployment rate rose to 25 pct in 2nd quarter

Spain’s unemployment rate rose to 25 pct in 2nd quarter

Spain’s unemployment rate rose to 25 pct in 2nd quarter

Spanish Economy Minister Luis de Guindos, talks to the press as he attends an economic forum in Madrid, Spain. EPA photo

Spain’s unemployment rate rose in the second quarter to 24.63 percent without benefitting from the usual spike from tourism, the government said on July 27.

The increase was smaller than in the first quarter, to nearly 5.7 million people out of work. Between April and June, 53,500 people lost their jobs, compared with 365,900 in the first quarter, the national statistics office said.

On July 30 the Bank of Spain will publish its provisional estimate of economic output in the second quarter, expected to show a contraction of 0.4 percent, compared with a 0.3 percent decrease in the first three months, Agence France-Presse reported.

The country has for the first time conceded it might need a full EU/IMF bailout worth 300 billion euros ($366 billion) if its borrowing costs remain unsustainably high, a eurozone official said. Economy Minister Luis de Guindos brought up the issue with German counterpart Wolfgang Schaeuble in a meeting in Berlin on July 24 as Spain’s borrowing costs soared past 7.6 percent, the source said.

If needed, the money would come on top of the 100 billion euros already agreed to prop up Spain’s banking sector, stretching the euro zone’s resources to breaking point, and Schaeuble told de Guindos he was unwilling to consider a rescue before the currency bloc’s ESM bailout fund comes on line later this year.

“De Guindos was talking about 300 billion euros for a full programme, but Germany was not comfortable with the idea of a bailout now,” the official told Reuters. “Nothing will happen until the ESM is online,” the official said.