It hasn't been easy for Madrid, but at least now they can breathe a sigh of relief. The Spanish Treasury this morning managed to place i 3 billion of medium and long-term sovereign bonds. Demand has been good, more than triple the supply. However for i ten-year bonuses, benchmark for calculating the spread with the German Bunds, the yield reached a maximum (6,5%) which it hadn't seen since last November when it exceeded 7%. The average interest that Madrid will have to pay in ten years is rose to 6,43% from 6,04% in the last auction.
As regards medium-term securities, those in expiration in 2015 (three-year) have registered a average yield of 5,086% against 5,447% earlier, while those in expiration in 2016 (four-yearly) interest rose to 5,536% from 5,353% in the last auction.
It was the first test by the Spanish government after the European summit at the end of June. The Bonos-Bund spread today, pending the auction, had returned to exceed 500 basis points, threshold that he had left behind after the outcome of the meeting between European leaders. After the news of the auction, however, he reversed the upward trend and fell back to 506 basis points.
