If Spain is going bust why is their interest rate only 7% - please explain

Norman Younger
Director
Maximiti Limited
Columnist
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So the news is that markets in Eurozone have pushed up the rate of borrowing for Spain to 7% . I understand that it is many times the rate in other places and that a higher the rate  of interest treflects a greater risk. But surely if you really expect a default it has to be way above that ? I like to think I have a reasonable grasp of economics but this one has me flummoxed.

About Norman Younger

Accountancy practice brokerCommercial mediator & negotiatorBoutique business broker & corporate financier 25+ years professional experience, charity trustee and community worker with a broad (but not-always "PC") view of the country's financial, business, political and social problems. Tel: 0800 2800 321. Follow my personal Google+ page

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