The National Treasury Management Agency (NTMA) has raised another €1 billion in an auction of Irish Government bonds this morning.
Analysts said there was strong demand for the bonds. The NTMA has now raised most of the €25 billion it targeted this year to fund an expected Exchequer deficit of around €20 billion.
This morning, it raised €400m from the sale of a 4% bond due to mature in 2014, and €600m from a 4.5% 2018 bond.
Irish yield spreads over Germany were narrower today than they were at the time of the last bond sale in mid-July. This means investors see Irish bonds as a less risky investment than they did earlier in the year. The 2014 bond was sold at an average yield of 3.393% while the 2018 bond was sold at an average yield of 4.550%.
Bloxham economist Alan McQuaid described this morning's auction as 'very successful', adding that the NTMA could now begin to raise money to fund next year's government borrowing. Three more bond auctions are planned in 2009.
