Spain Sells 12-Month Bills at Lowest Yield on RecordAngeline Benoit and Levent Kucukreisoglu
Spain sold 12-month bills at the lowest yield since at least 2004, years before the start of a European debt crisis that pushed it to the brink of a sovereign bailout last year.
The Treasury in Madrid said it sold 3.71 billion euros ($5 billion) of one-year bills at an average yield of 0.678 percent. That’s the lowest since the start of the series in 2004. It also sold 840 million euros of six-month bills. The total amount of of 4.55 billion euros, exceeding the maximum goal set for the sale. Demand at the auction was 2.49 times the amount sold.
The euro region’s fourth-largest economy, which emerged from a two-year recession in the third quarter, is attracting foreign investors, helping it cover about 96 percent of its mid-and long-term funding plan for the year. Last week euro-area finance ministers said it’s on track to exit in January the aid program secured for its banks in 2012.
The yield on Spain’s 10-year benchmark bond rose one basis point today to 4.08 percent at 11:41 a.m. in Madrid, compared with a euro-era high of 7.75 percent in July 2012, before European Central Bank President Mario Draghi first pledged to support the single currency. The spread with similar German maturities narrowed to 238 basis points.