Spain and Greece top EU agenda next WEEK

The Spanish deputy budget minister said the news is "false." The European Commission declined to confirm or deny it, but a spokesman said "the instruments are there and ready to be used should a demand be made."

If it happens, it will be the fourth bail-out since the crisis began.

Unlike Greece, Ireland and Portugal, Spain is expected to ask for a mini-rescue for its banks only from the EU, rather than for a fully-fledged state bail-out from the EU and the International Monetary Fund (IMF).

For its part, the IMF will in a report on Monday say how much money Spanish banks need.

The window of opportunity for Spain is closing.

The last surveys in Greece on 1 June before polling closed showed the anti-bail-out Syriza party slightly ahead of the pro-bail-out New Democracy party.

Syriza has promised to bin austerity measures attached to Greece's EU-IMF rescue package if it wins.

If the scenario comes to be, Greece will probably leave the euro, creating uncertainty for any further bail-outs and on the fate of the single currency.

Meanwhile, MEPs will on Wednesday in Strasbourg vote on the so-called two-pack law.

The budgetary discipline bill applies to eurozone countries only and represents a quantum leap in European Commission power.

Under the two-pack, eurozone states will have to submit national budgets to EU officials for inspection. EU institutions will be able to force them to make changes or even send monitors to national capitals to oversee day-to-day spending.

On the foreign relations front, the new Serb President, Tomislav Nikolic will visit the EU capital on Thursday.

Since taking office, he has rejected the EU designation of Serb killings in Srebrenica as "genocide" and has said the town of Vukovar in Croatia belongs to Serbs.

On Friday, he told the Tanjung news agency he plans to ask Brussels a taboo question: "Does the EU insist that Serbia accept the independence of Kosovo in order to continue its path to the EU?"

In other events, MEPs on the civil liberties committee will on Monday vent their spleen against a recent decision by EU countries to ignore them on EU border control.

EU ministers will on Tuesday propose changes to a European Commission plan on fishing stocks - leaked proposals have drawn ire from pro-green NGOs.

French voters will also return to the ballot box on 10 June and 17 June to vote in MPs.

Polls indicate that Francois Holland's Socialists will gain a majority, giving him a stronger domestic mandate against Germany in the growth-austerity tug-of-war.