The Spanish bluff.

The Spanish government is doing a delicate dance, now that jawboning by Draghi reduced the rate the Spanish govt has to pay on newly issued sovereign bonds. Investors expect that Spain will have to ask for a bailout and that the ECB will buy a bunch of Spanish bonds. Hence the reduced rates.

There is another side to this coin. Spain has to ratchet up "austerity" and PM Rajoy is not keen on doing that, provoking further demonstrations. The word is that Rajoy is waiting untill the elections are over in Galicia (NW of Spain where Rajoy is from) and then bear down a bit harder.

This soap opera continues.