Spain pays higher rates in 3.75-bln-euro bond sale
Spain raised 3.75 billion euros ($5.0 billion) on the debt markets on Thursday, the maximum it was seeking, but had to pay higher interest rates.
The Treasury offered yields of more than five percent in an auction of three- and four- and five-year debt, the Bank of Spain said.
It paid yields of 5.187 percent for the three-year bonds, 5.276 percent for the four-year bonds and 5.544 percent for the five-year bonds.
Spain paid between 3.639 and 4.782 percent during the previous auctions of bonds of the same length that took place between February and October.
Demand was strong, close to 10.3 billion euros. The Treasury was seeking to raise 2.75-3.75 billion euros.
Analysts said the move by leading central banks on Wednesday to pump liquidity into the financial system to prevent a second credit crunch linked to the eurozone debt crisis had boosted market sentiment and helped lift demand.
The European Central Bank, the US Federal Reserve and central banks in Japan, Britain, Canada and Switzerland unveiled coordinated lending action to reduce strains on financial markets.
Spain's risk premium -- the extra interest rate investors demand over safe-haven German debt -- fell Wednesday below 400 points following the move.
© 2011 AFP