Spain agrees borrowing cap to stem debt fallout

Spain has put in place a public sector borrowing cap in an effort to tackle its debt burden, following calls from peers in Europe to take action.

The country's government has passed a constitutional limit on public sector borrowing as it looks to further reduce its deficit, reports the BBC. The move comes after France and Germany called on eurozone countries to put in place borrowing caps to ease the debt crisis. Spain is also looking to ramp up its programme of austerity measures in a bid to cut its deficit from over 9% of economic output to 6%. The ECB's decision to buy Spanish government bonds has recently led to falling  borrowing costs for the country, but this has reversed in the last few days as investors shun bonds i...