While a money market foray remains off the cards for Greece for now, Cyprus managed to raise 1.5 billion euros on Tuesday in a sale of 10-year bonds, shortly after Standard & Poor’s upgraded the island’s credit rating out of junk status on Friday.
Demand for Nicosia’s new paper came to 5.5 billion euros and the interest rate came to 2.4 percent, beating original estimates for 2.6 percent.
The economies of the two countries are very different, as Greece sees growth this year coming to just 2 percent after its bailout program exit in August, while Cyprus had expanded 4 percent when it emerged from a similar program in 2016.
Athens is shut out of the European Central Bank’s bond-buying program – unlike Nicosia – and the country’s bonds remain ineligible as collateral for cheap ECB credit for Greek banks. Premier Alexis Tsipras admitted this month that Greece may get an investment-grade rating in three years’ time.