Debt crisis: Spanish GDP falling at 'significant pace' "The available data for the third quarter of the year suggest output continued to fall at a significant pace, in an environment in which financial stress remained at very high levels." the Bank said in its monthly report. Spain's borrowing costs edged back past 6pc on Wednesday as investors sought safer havens. The yield on benchmark ten-year government bonds rose 26 basis points to 6.01pc, the biggest increase since August 31, while the IBEX 35 in Madrid slid 3pc to 7,926.20. The eurozone's fourth largest economy tumbled into recession in the last quarter of 2011, less than two years after emerging from the previous crisis. The economy posted a 0.4pc contraction in the three months to June, following declines of 0.3pc in the previous two quarters. Official forecasts that the economy will contract by 1.5pc this year, and 0.5pc in 2013 are considered optimistic by many analysts. The market jitters come amid continued speculation that Spain will need a full-scale bail-out. Spanish prime minister Mariano Rajoy said on Wednesday that he still did not know if the country would apply for aid from Brussels, but added that if interest rates on the country's debt were "too high for too long," he would not hesistate to ask. "I can assure you 100% that I would ask for this bailout," he told the Wall Street Journal. Thousands of protesters took to the streets in Madrid yesterday to protest against harsh spending cuts and Mr Rajoy's government. Spain has already accepted a rescue loan of up to €100bn to shore up its beleaguered banking sector, which has been blighted by the fallout from the country's 2008 property market crash.