In his highly anticipated speech, regional President Carles Puigdemont said the landslide victory in a disputed October 1 referendum gave his government the grounds to implement its long-held desire to break century-old ties with Spain.
Earlier on Tuesday, Puigdemont told the Catalan parliament in Barcelona that the region had won the right to be independent as a result of the vote.
He said a landslide victory in the region's disputed October 1 referendum on independence gives his government grounds to implement its long-held desire to break century-old ties with Spain. But the poll was poorly monitored and many Catalans opposed to secession boycotted an illegal plebiscite that triggered a vio lent police crackdown.
And when the Catalan president got to the crux of his speech, he said he would eventually ensure that Catalonia would become an independent republic.
Spain called an emergency Cabinet meeting for Wednesday, and Prime Minister Mariano Rajoy was scheduled to address the Spanish parliament afterward. "We will apply what the law says", he told TV3.
One EU official said Puigdemont "seems to have listened to advice not to do something irreversible".
Puigdemont and his allies then signed a declaration of independence for the region, but suspended its implementation.
In Barcelona, Catalonia's regional capital, some supporters of independence watched Puigdemont's speech on huge screens, wrapping themselves in Catalan flags.
Switching from the Catalan language to Spanish as he addressed the regional parliament, Puigdemont appeared to return a thinly veiled barb at Santamaria's comments. "Independence is our future and depends on us, young people".
Spain's third largest bank by market value, CaixaBank, and its smaller competitor, Banco Sabadell, said last week they were shifting their legal homes out of Catalonia, a move that would keep them in the European Union if Spain breaks in two.
A representative of another European movement for independence, Jonathon Shafi from the Radical Independence Campaign championing Scottish independence, has also criticized Madrid's actions during and after the Catalonian referendum.
Analysts said Puigdemont's call for conciliation might not stave off a sharp reaction from the Madrid government, which has a range of options at its disposal.
"It's very clear to me that those who I represent won't accept any other scenario", Benet Salellas said during an interview at the regional parliament.
U.S. Treasury prices gained on Tuesday as investors were cautious ahead of a possible move by Catalonia to unilaterally declare independence from Spain as well as a heavy week of domestic economic data and bond and note auctions. Whatever happens next, the political gulf between Madrid and Barcelona will take some time to heal, if it ever can.
"The battle of European values is under way and we have to win it", he said, drawing parallels between such challenges to the European project from populist and separatist sentiments that have been gaining traction in Europe recently.
"After having come so far, and taken Catalonia to the greatest level of tension in its history, President Puigdemont has now subjected his autonomous region to its greatest level of uncertainty".
Gold prices also hit their highest in more than a week against the backdrop of a weaker dollar although expectations for another U.S. interest rate hike capped gains.
Demonstrators challenge Catalan Mossos d'Esquadra regional police officers at the end of a march in downtown Barcelona, Spain, to protest the Catalan government's push for secession from the rest of Spain, Sunday Oct. 8, 2017.
However, the leader of the parliamentary group of the Popular Party of Mr. Rajoy, Rafael Hernando, said on Tuesday that the situation called for the application of a series of measures and not just one article of the Constitution.