Financial noose around Spain is getting tighter and tighter, as on the one hand the market is now reacting to the latest ratings downturn from Standard and Poor, and on the other, indicators appear set to declare the country bankrupt later this year, due in no small part to the Credit Default Swap procedure yesterday registering an increase on 9 points to arrive at 118.5. However, this is still lower than the 130 it hit last December [the figures mean that for a price of 100 supposes that to cover bonds of ten million euros, 100,000 should be paid]. According to Merrill Lynch, the 106 figure means that there is an 8% probability of not paying, but over the last few days this has increased to a 9% probability. By comparison Germany has a 4% rating, Greece an 18%, Ireland a 15% and Italy 14%, with rumours rising that possibly one country of the euro zone is considering pulling out of the single currency.

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