Investing.com - Spain saw borrowing costs rise at an auction of three- and four-year government bonds Thursday, amid growing concerns over the health of the euro zone’s fourth largest economy.
Spain’s Treasury sold EUR372 million worth of three-year government bonds maturing in January 2015 at an average yield of 4.375% earlier in the day, up sharply from 2.890% at a similar auction last month.
Demand was stronger, however, with bids exceeding supply 4.47 times versus a "bid-to-cover" ratio of 2.41 in April.
The country sold an additional EUR1.02 billion of three-year debt maturing in July 2015 at an average yield of 4.876%, up from 4.037% at a similar auction last month.
Spain also sold EUR1.1 billion of four-year debt at an average yield of 5.106%, up from 3.374% at a similar auction last month. The bid-to-cover ratio stood at 2.38, compared to 4.13 at an auction in April.
Bond auctions have become key drivers of risk sentiment in recent months, as traders attempt to gauge the ability of indebted euro zone nations to fund themselves.
Following the bond auction, the euro trimmed gains against the U.S. dollar to trade largely unchanged, with EUR/USD trading at 1.2717.
Meanwhile, European stock markets remained lower. Spain’s IBEX 35 Index dipped 0.1%, the EURO STOXX 50 shed 0.6%, France’s CAC 40 fell 0.4%, Germany's DAX declined 0.4%, while London’s FTSE 100 slumped 0.6%.
Spain’s Treasury sold EUR372 million worth of three-year government bonds maturing in January 2015 at an average yield of 4.375% earlier in the day, up sharply from 2.890% at a similar auction last month.
Demand was stronger, however, with bids exceeding supply 4.47 times versus a "bid-to-cover" ratio of 2.41 in April.
The country sold an additional EUR1.02 billion of three-year debt maturing in July 2015 at an average yield of 4.876%, up from 4.037% at a similar auction last month.
Spain also sold EUR1.1 billion of four-year debt at an average yield of 5.106%, up from 3.374% at a similar auction last month. The bid-to-cover ratio stood at 2.38, compared to 4.13 at an auction in April.
Bond auctions have become key drivers of risk sentiment in recent months, as traders attempt to gauge the ability of indebted euro zone nations to fund themselves.
Following the bond auction, the euro trimmed gains against the U.S. dollar to trade largely unchanged, with EUR/USD trading at 1.2717.
Meanwhile, European stock markets remained lower. Spain’s IBEX 35 Index dipped 0.1%, the EURO STOXX 50 shed 0.6%, France’s CAC 40 fell 0.4%, Germany's DAX declined 0.4%, while London’s FTSE 100 slumped 0.6%.