FIRST AIRED: July 19, 2016

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>> Another attempt to create a government in Spain. Another failure to end the seven months of political deadlock. The Socialists announcing they'll vote against a government led by the acting conservative People's Party leader Pedro Sanchez, ruling out a grand coalition of the right and the left. Reuters, Julien Toyer, in Madrid explains how things stand.
>> But right now everything is a little bit up in the air, actually. The only possibility is for the PP to run a minority government and the socialists to abstain. If the socialists don't want to do it, then I think the only alternative will be assertive action, obviously.
>> The first election in December was inconclusive. The second, in June, was won by the PP, but without the majority it needed to govern alone. Now the liberals ciudadanos announcing they would abstain in a vote for a conservative government.>> The issue is ciudadanos placed fourth in the last election.
They have only 32 seats in the 350 strong assembly and it's obviously not enough to secure a majority for Rajoy. So it's the symbolic move, an interesting one, but it has no effect in practical terms.>> Any economic impact of the impasse has been very limited, if non-existent so far.
Spain even likely to revise up it's economic forecast towards the end of the month.>> Right now the morale remains pretty high as well. The tourist season is on. It's gonna be a record high. Millions of people are coming to Spain to spend their holidays. The airports are full.
The cafes are full. The restaurants are full. People are not really seeing any material effect. A recent opinion poll, an official one, showed a couple of weeks ago that only 3% of Spaniards were worried about the lack of government. So if anything, it's not something that is really discussed in the streets right now.
>> Rajoy is aiming to form a government for early August. But with talks so far being slow, no one is holding their breath.