Spain to need full bailout as borrowing costs surge, say investors

Investors expect Spain to become the fourth euro member to need external funding as borrowing costs surge to levels too punitive for the nation to finance its needs on capital markets.

Spanish debt has slumped, pushing the 10-year yield to a euro-era record of 7.14% yesterday.

The bonds are the worst performers among 26 developed markets since June 9, when economy minister Luis de Guindos said he would request as much as €100bn of emergency loans to shore up a Spanish banking system hobbled by bad assets.