Madrid announced a detailed table for economic reforms and a budget based mainly on spending cuts rather than tax measures, boosting expectations that a rescue package is not far away.
At 0603 GMT, Bund futures, seen as a safe haven asset, were 14 ticks lower at 141.43.
"They're making the right noises, but whether they can actually put these things in practice is a different matter in a country with no growth and 25 percent unemployment," one trader said.
"I'm going to remain sceptical, but the market has given them the benefit of the doubt."
Challenges remain for Spain, however.
The results of an independent audit of Spanish banks will be published later in the day and Moody's Investors Service is expected to finish its rating review on the sovereign, which may lose its investment grade status.