The yield on a Greek government bond maturing in 2019 fell on Monday to its lowest level since it was issued three years ago, as Athens prepared to end a three-year exile from financial markets.
Greece on Monday invited holders of its bond maturing in 2019 to tender them for cash or switch into new bond that will mature in 2022. Analysts said the deal was encouraging investors to snap up the existing debt in anticipation of being offered lucrative terms to switch into the new bond.
"It is normal that you would see the bond that Greece is looking to buy trading firmly in secondary markets," said Mizuho strategist Peter Chatwell.
"If Greece wants to encourage investors to sell out of the old five-year and buy into the new five-year then it will have to come at a competitive price."
The yield – which moves inversely to price – on the outstanding Greek bond fell as much as 40 basis points to 3.42 percent, its lowest since issue in April 2014.