Spain\'s borrowing costs plummeted Thursday as markets awaited imminent news of a European Central Bank plan to help stricken eurozone states by purchasing their bonds. The Treasury raised 3.5 billion euros ($4.4 billion) at far lower rates in a bond auction, winning at least a brief reprieve from punishing yields driving the nation towards a sovereign bailout. The sale coincided with an ECB meeting in Frankfurt, after which the bank\'s president, Mario Draghi, is expected to set out the mechanism for a renewed bond-buying programme. Draghi has already said the ECB plans to curb high rates by purchasing debt-struck member states\' bonds -- but only after they have formally asked for a eurozone bailout with strict conditions. \"We have to urgently resolve the problem of the so-called periphery economies: Greece, Portugal, Ireland, Italy and Spain,\" Foreign Minister Jose Manuel Garcia-Margallo said. \"Only the central bank can do this by putting out the fire,\" the minister told Onda Cero radio. Spanish Prime Minister Mariano Rajoy would seek to convince German Chancellor Angela Merkel of this during a closely watched meeting taking place in the afternoon. \"We are going to say that everything is fine but in the medium term we have to finance ourselves. And it is the European Central Bank that has the money,\" Garcia-Margallo said. Spain lured modest interest for the issue; with demand outstripping supply by a little less than two to one. But interest rates slumped when compared to earlier, comparable government bond sales.Two-year bond rates slid to 2.798 percent from 4.706 percent on June 21; three-year rates fell to 3.676 percent from 5.086 percent on July 5; and four-year rates dropped to 4.603 percent from 5.971 percent on August 2. \"But the risk of disappointment today is high,\" said analysts at brokerage Bankinter, warning of the risk of a backlash. \"If the ECB is less explicit or softer than expectations, which have driven the market rise in August, then the stock markets could do a U-turn and the euro could drop suddenly,\" it said in a report. Analysts at Spanish brokerage Renta 4 were also on guard. \"If some details are sketchy, we could see profit-taking after the excellent performance of the markets in August,\" they said in a market update. Many investors and analysts believe there is now no doubt that Spain, which faces about 30 billion euros in debt repayments in October, will formally ask for a bailout, unlocking ECB aid. But Madrid wants to avoid new conditions, having already announced plans to claw back 102 billion euros by 2014 with a series of austerity cuts and tax increases. \"We don\'t expect any surprises from the ECB, which, this time, seems to want to be predictable. So the only fact to analyse is the conditions that will be imposed on countries that demand aid,\" said an analysis by brokerage Link Securities. \"Everything suggests that the Spanish government will continue to press for no new commitments being imposed, and that Rajoy will use his meeting with Merkel to do so,\" Link Securities added. \"We think the conditions for Spain, in the likely case it asks for a \'light\' bailout, will be limited to it meeting its deficit reduction targets for 2012-2014,\" the brokerage said. But those targets are widely seen as extremely difficult at a time of recession, which tends to slash tax revenue and raise costs for items such as jobless benefits, with unemployment at nearly 25 percent. Spain posted blow-out budget deficit of 8.9 percent of gross domestic product last year, far exceeding the 6.0 percent target. Now it is committed to lowering the deficit to 6.3 percent in 2012, 4.5 percent in 2013 and 2.8 percent in 2014. \"It is therefore foreseeable that the government, despite its denials, could be forced to take new measures if it wants to receive the external aid it needs,\" Link Securities said.