ECONOMY

Cost of short term debt eases in auction

Greece raised 1.63 billion euros on Tuesday through a sale of 13-week treasury bills at a lower interest rate than last month, the Public Debt Management Agency (PDMA).

The PDMA said the bills were at a yield of 4.06 percent, down slightly from the previous rate of 4.10 percent at an April 19 auction.

The agency says Tuesday’s auction was more than three times oversubscribed.

Foreign investors bought 31 percent of the bills, PDMA added.

Earlier on Tuesday, Greek two-year yields fell 13 basis points to 24.78 percent. The 4.6 percent security due in May 2013 gained 0.175, or 1.75 euros per 1,000-euro face amount, to 70.87. Ten-year yields were little changed at 15.63 percent.

Portuguese 10-year yields fell four basis points to 8.93 percent after the country become the third member of the 17- nation currency bloc after Greece and Ireland to receive emergency loans from the European Union and the International Monetary Fund. The decision by European finance chiefs on Monday to provide assistance to Portugal brought to 256 billion euros the aid provided to stamp out the Europe?s sovereign debt crisis.

?Peripheral markets were given a bit of relief by events overnight,? Nick Stamenkovic, an Edinburgh-based fixed- income strategist at RIA Capital Markets Ltd., told Bloomberg.

?That?s taken the shine off bunds, and the recent rally has run out of steam.?