Spain won't need a bailout: euro zone official

Spanish 10-year borrowing costs on Tuesday dipped below 6% on investor concern that a recession in the Spanish economy would reduce the country's ability to service its debt

Spain will not need financial aid from the euro zone because its fiscal consolidation is impressive and its structural reforms are on track, the chairman of euro zone finance ministers Jean-Claude Juncker said on Tuesday.

Spanish 10-year borrowing costs on Tuesday dipped back below the 6% level hit on the secondary market on investor concern that a recession in the Spanish economy would reduce the country's ability to service its debt.

Investors are also worried that falling real estate prices in Spain, against which Spanish banks extended mortgage loans, could mean the banking sector could need more capital than provided for now.

But Juncker dismissed such concerns.

"I am really impressed with (Spain's) ambitious consolidation programme," he said in Luxembourg.

"I don't think Spain will need any kind of external support. There is no reason for Spain to ask for a specific programme, I would like to invite financial markets to behave in a rational way. Spain is on track," Juncker said.