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Spanish 3-Month Borrowing at Lowest Levels

Spain sold 3-month bills at the lowest yield on record at an auction on Tuesday as investors snatch up relatively high-paying instruments in expectation of a European Central Bank rate cut to counteract euro zone recession.

Spain’s borrowing costs have dropped steadily since last summer, when the country seemed to be heading into a financial crisis that could trigger an international rescue, despite a stubborn recession and scarce bank credit for businesses.

The Treasury sold 3 billion euros ($3.9 billion) of 3-month and 9-month paper, at the top end of its target.

The 3-month paper sold 855 million euros at an average yield of 0.120 percent, the lowest since the Treasury introduced the paper in 1991, at a bid-to-cover ratio of 3.8 after 3.3 last month.

The Treasury sold 2.2 billion euros of the 9-month bill, introduced in February, at a yield of 0.787 percent, down from 1.007 percent in March. The paper was 2.4 times subscribed, unchanged from last month.

via CNBC [1]

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Alfonso Esparza

Alfonso Esparza [6]

Senior Currency Analyst at Market Pulse [7]
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza
Alfonso Esparza

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