The Spanish Treasury today sold 3.52 billion euros of 10-year bonds, more than planned but at a higher rate than before as investors sought more reward to lend money to Spain after recent debt scares.
The average yield of 4.04% on the April 2020 bonds was up from 3.855% during the last similar auction on March 23.
Investors submitted offers worth €7.163 billion, and the government issued less about half that amount but just slightly more than its overall target of €3.5 billion.
One analyst described the auction as 'reassuring'.
Fears that Greece's debt crisis could engulf Spain and Portugal have hammered financial markets in recent months, pushing up Spanish and Portuguese borrowing costs and driving the euro to a four-year low.
After Spain's public deficit swelled to 11.2% of output last year, the government has committed to an austerity drive to slash the shortfall between its revenues and its spending to 3% in 2013.
Sovereign debt bonds are issued with a fixed annual return or interest, called yield, which does not change in cash terms during the life of the bond, in this case for ten years when the amount lent per bond is repaid.
