Gov’t sells 7 bln euros in bonds

Greece issued 7 billion euros’ worth of new three-year bonds yesterday in the country’s second debt sale since its credit rating was cut by Standard & Poor’s. The 4.3 percent notes, which mature on March 20, 2012, were sold to yield 249.2 basis points more than German government notes of similar maturity and 190 basis points over the benchmark mid-swap rate. S&P cut Greece’s rating last month by one step to A-, the lowest grade among the 16 nations using the euro and six levels below the highest, citing the country’s failure to stick to budget plans, boost revenue and reduce debt. Economy and Finance Minister Yiannis Papathanassiou described the auction as being positive as investors bid for 10 billion euros of government paper and spreads started to narrow. «This shows that the markets are becoming aware that Greece does not run the risk (of default),» the minister said. (Bloomberg, Kathimerini)

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