During a NATO summit in Turkey, President Donald Trump expressed strong disapproval of Spain's defense spending, labeling the country a 'terrible partner' and suggesting a complete trade cutoff. This criticism stems from Spain being the only NATO member not committed to spending 5% of its GDP on defense by 2035.
Following Trump's remarks, Spanish bonds experienced a sell-off, with the yield on the benchmark 10-year bond rising by 7 basis points to 3.5408%. Additionally, the Spanish IBEX 35 equity index fell over 1%. These developments indicate that Trump's comments could have significant implications for Spain's financial markets and its relationship with NATO allies