Spain’s borrowing costs rise sharply in bond auctionMay 18th, 2012 - 12:14 pm ICT by IANS
Madrid, May 18 (IANS/EFE) Spain’s Treasury auctioned 2.5 billion euros ($3.18 billion) worth of bonds maturing in 2015 and 2016 Thursday, but was forced to pay sharply higher interest rates.
The bond sale came amid rising tensions in the eurozone over the political and economic crisis in Greece, where new elections will be held June 17 after failed negotiations to form a coalition government.
Demand outstripped supply in the auction by nearly three to one.
The Treasury sold 371.76 million euros of bonds maturing on Jan 31, 2015, at an interest rate of 4.42 percent, up from 2.96 percent in the previous auction.
Another 1.02 billion euros worth of bonds maturing on July 30, 2015, were placed at a borrowing rate of 4.92 percent, compared with 4.07 percent May 3.
Meanwhile, 1.1 billion euros of bonds maturing April 30, 2016, were sold at an interest rate of 5.13 percent, compared with 3.43 percent in the previous issue.
Thursday’s auction was the first since Spain’s debt-risk premium briefly surpassed the 500-basis-point barrier Wednesday before ending the session at 482 bps.
On Thursday, the debt-risk premium - the extra return investors demand on Spanish government bonds compared to safe-haven German debt - rose again to 490 basis points before retreating back to around 483 bps.
The yield on Spain’s benchmark 10-year bond - used to determine the debt-risk premium - fell on the secondary market to around 6.33 percent after the auction.
- Spain raises 2.59 bn euros in bond sale - Apr 05, 2012
- Spain auction sees lower borrowing costs for benchmark bond - Sep 21, 2012
- Spain sells 3.2 bn euros in bonds at higher rates - Apr 18, 2012
- Spain pays sharply lower yield on 10-year bonds - Jan 20, 2012
- Spanish debt auction attracts strong demand - Jan 13, 2012
- Spain blames Europe growth concerns for debt-risk premium rise - Apr 06, 2012
- Spain sells bonds at sharply lower yields - Jan 18, 2012
- Spain's risk premium hits euro-era record - Jul 20, 2012
- Spain sells $3.2 bn in bonds - Dec 17, 2010
- Yield on Spanish bonds climbs up - Jul 10, 2012
- Markets continue to hammer Spanish debt - Jul 24, 2012
- EU needs fiscal, bank integration: Spanish PM - Jun 06, 2012
- Federal Reserve to pump more liquidity into US economy - Sep 14, 2012
- Mexican oil giant sells $327 mn in bonds - Mar 14, 2012
- US stocks end higher amid European optimism (Lead) - Jan 13, 2012
Tags: , , , , , , , , , , , , , , , , , , ,