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Spain, Italy reject rescue, welcome ECB announcement

Published on Aug 3, 2012 9:41 AM

MADRID (AFP) - Spain and Italy, the shakiest big economies in the euro zone, rejected on Thursday the need for a financial rescue and vowed to work more closely to solve the long-running debt crisis.

Spanish Prime Minister Mariano Rajoy and his Italian counterpart Mario Monti also welcomed the European Central Bank (ECB)'s announcement that it may may resume government bond purchases to help bring down high euro zone borrowing costs.

"It is a positive statement," Mr Rajoy told a joint news conference in Madrid.

Markets were disappointed however by the ECB announcement, with stocks down sharply, especially in Madrid and Milan, after investors had expected the bank to take immediate action on the debt crisis.

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