Spanish Prime Minister Pedro Sanchez's wife Begona Gomez on Wednesday denied in court misusing public funds by hiring a personal assistant in an embezzlement probe that has rattled the leftist government, legal sources said.

The long-running investigation is one of several into Sanchez's family and former close allies that have embarrassed the Socialist leader and heaped pressure on his minority coalition.

Judge Juan Carlos Peinado set off the saga in April 2024 by opening an investigation to determine whether Gomez exploited her position as Sanchez's wife for private benefit.

The latest development centres on whether an official employed in the premier's office, Cristina Alvarez, worked for Gomez during her past academic job at Madrid's Complutense University.

If that were true, it could "represent a diversion of public resources in favour of private interests", Peinado wrote in his ruling that summoned both women.

Gomez only replied to her lawyer on Wednesday during a fourth closed-door hearing before Peinado in Madrid, according to legal sources.

She said spouses of previous prime ministers hired staff to coordinate their agenda and security, the sources added.

Gomez said Alvarez never helped her in her private professional activities, though she occasionally sent messages that did not affect her primary work, according to the sources.

Sanchez has dismissed the allegations against his wife as an attempt to undermine his government by the right, which has demanded his resignation.

This month he said there were "judges who do politics and politicians who try to do justice" and denounced spurious complaints by groups with far-right ties.

Separate corruption probes have ensnared two former Socialist heavyweights, Santos Cerdan and ex-transport minister Jose Luis Abalos, as well as the prime minister's younger brother David Sanchez.

The legal troubles compound woes for the minority government which engages in laborious negotiations with an array of fringe and regional separatist parties to try to pass legislation.