Mariano Rajoy may choose to present the world with a solemn, bespectacled face which betrays deep concern about the gravitas of the impending catastrophe at hand. But according to some commentators and a rather extraordinary couple of text messages which have come to light in the last few hours, this solemn visage could, in fact, be Rajoy’s poker face.

The announcement that Spanish banks have secured a EUR100bn aid deal came at the weekend after weeks of wrangling, with the palpable sense of relief sending markets reeling. Global stocks climbed and the EUR/USD gaining 125 pips on live forex charts on the news, with commodities also benefitting from the renewed appetite for risk spurred on by the apparent resolution.

But Neal Kimberley of Thomson Reuters observes that Rajoy’s performance would make even the most astute poker player nervous. “Note to self: never play poker with Spain’s Rajoy”, he muses in an emailed note. “...he’s good.  It seems to me he’s just faced down the euro zone at little immediate cost to Spain. As for Angela Merkel, well as Mr Rajoy’s comments about winning a better deal for Spain start to get digested by the German press, I would suggest Ms Merkel’s position is further undermined.  It looks, rightly or wrongly, if she blinked”, mused forex news analyst Kimberley.

“Resist…Spain is not Uganda”

As the fourth nation to require international assistance to sort out its ailing banking sector, it appears that Rajoy has judged his call for banking aid astutely. With a text message to Spanish finance minister from the aforementioned PM, confirming the extent of his resolution to sit it out and wait for the promise of aid he felt sure would come.

Spanish newspaper El Mundo has reported in the last hour, that Rajoy texted the Luis de Guindos at the weekend, while negotiations were ongoing. According to El Mundo editor Pablo Rodriguez, Mr Rajoy texted Luis de Guindos: "Resist, we are the 4th power of the EZ. Spain is not Uganda."

A subsequent message has now been translated as: “We are powerful, and if they don't give in, the whole thing will go down. It will cost Europe 500 billion if Spain goes bust, and then another 700 billion if Italy goes bust.”

Rajoy may have won the battle of nerves, but the question now is whether he will be successful in winning the war on Spanish decline. One and out of four Spaniards is jobless and it has already been anticipated by ratings agency S&P’s, that Spain will miss its deficit targets for at least the rest of 2012 (hence the recent downgrade). The promise of a banking bailout – now dubbed the ‘Spailout’ by abbreviation-mad journalists – may have bought some time to restore faith in the euro zone’s ability to maintain its beleaguered nations, but it is by no means out of the woods. Particularly with no indication as yet, as to where this cash will come from and how repayments will work in comparison to the Irish, Greek and Portuguese deals.

Sarah Cox, Staff Writer