Great success for Spain in the last auction of government bonds. This morning the Treasury of Madrid has placed Bonos at 12 and 18 months for a total of 5,75 billion euros, a sum exceeding the maximum target of 5,5 billion.
Interest rates have fallen sharply: on 12-month bonds the average yield fell to 1,472% from 2,556% at the December auction, while on 18-month bonds it fell from 2,778% to 1,687%. The ratio between supply and demand on one-year bonds was 2,21, from 2,46, while on 18-month bonds the bid to cover rose from 2,7 to 2,71.
Despite the positive outcome of the placement, the Spanish spread remains above 340 basis points, while the yield on ten-year bonds rose to 5.074 in the morning, to then drop back slightly below the psychological threshold of 5%.
