The cost of borrowing for embattled euro zone nation Greece got even more expensive on Wednesday, as investors shunned the country’s sovereign debt ahead of tough negotiations with its international creditors.
The yield on its 10-year sovereign spiked to 8.401 percent on Wednesday morning, after pushing sharply higher on Tuesday afternoon. At the beginning of the week, yields were trading around 8.042 percent.
Yields this week have not reached the 9 percent level hit in mid-October when negative sentiment surrounding Greece spread to global markets. However, rising debt yields do highlight that the country’s economic woes are far from over, with a crucial deadline in early December looming large on the horizon.
“Greece still has sizeable financing needs in 2015 and it remains up in the air how these will be covered, which is likely to be causing market nervousness,” Sarah Pemberton, the European economist at Capital Economics, told CNBC via email.
It comes as Athens attempts to exit its bailout program – which has been hugely unpopular in the country – ahead of schedule. The government is hoping to strike a deal with the so-called “Troika” of bailout monitors – the European Union, International Monetary Fund (IMF) and European Central Bank (ECB) – before a December 8 deadline.