Spain unveils €40bn of fresh austerity measures

The Spanish government has announced €40bn in spending cuts and budget savings in its latest attempt to turnaround the country's struggling economy.

The 2013 budget, the fifth round of cuts and tax hikes announced the past nine months, is in line with recommendations made by the EU in July, Spanish officials said. The proposals will see government spending fall by 8.9% next year, with such expenditure set to be monitored by a new independent budgetary authority. Markets initially reacted positively to the news, Spanish 10-year yields moving back below the 6% mark and Spain's benchmark IBEX equity index rising 1% at the open, before those gains were later reversed. The measures suggest Spain is a step closer to an EU bailout tha...