Spain, Europe Debt | featured news

Thousands of students and teachers staged a strike across Spain on Thursday to protest government austerity measures and a planned new education reforms.

Local governments across Spain have been paying their suppliers' bills months behind schedule, forcing companies to help shoulder the financial woes of the Spanish government.

The Spanish government said Wednesday it will decide within the next few weeks whether to ask for outside financial help, noting it might opt for a precautionary line of credit instead of bailout cash.

Spain could ask for financial aid from the euro zone next month and if it does the request would likely be dealt with alongside a revised loan program for Greece and a bailout for Cyprus in one big package, euro zone officials said.

Spain’s conservative prime minister, Mariano Rajoy, is not known as a gambling man. But as Europe’s debt crisis stretches on, he is playing a tense game of chicken with the financial markets, betting that Spain can balance its books with homegrown austerity while putting off — maybe forever — a humiliating bailout from the European Union.

Tens of thousands of Spaniards and Portuguese rallied in the streets of their countries' capitals Saturday to protest enduring deep economic pain from austerity cuts.

Spanish jobless claims rose at the slowest pace in six years in August, the country's labor ministry said, a sign that surging unemployment in the euro zone's fourth-largest economy is leveling off.

Corporate storm clouds gathered over Spain again as two major European companies joined the ranks of those saying they were taking steps to reduce exposure to the recession-hit country.

At the start of another critical week for the euro, the head of the finance ministers that use the currency, Jean-Claude Juncker, reinforced expectations Monday of an initiative to lower Spain’s borrowing costs, which had hit alarming heights.

Spain 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 euro zone official said.