Spain made to pay
MADRID– Debt-laden Spain has raised ‚2.98 billion on the financial markets, but was forced to pay higher interest rates.
The average yield on bonds repayable in five years rose to 6.46 per cent, against 6.07 per cent at an auction last month.
The average yield on seven-year bonds was 6.7 per cent, up from 4.83 per cent last time.
“They [Spain] sold what they wanted to sell, that’s about the only good thing about it,” said Monument Securities analyst Marc Oswald.
Investor demand for the bonds fell, with the issue 2.1 times oversubscribed, compared with 3.4 times in June.
Investors remain worried about Spain’s high funding costs and whether there is a viable plan to recover from a four-year economic downturn.
Today, German MPs were due to vote on an aid package of up to ‚100 billion for Spain. BBC)