Spain sees strong demand in $3.3 billion debt sale

AP News
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Posted: Jan 24, 2012 7:37 AM
Spain sees strong demand in $3.3 billion debt sale

Spain successfully raised euro2.5 billion ($3.3 billion) in a short-term debt sale with strong demand and lower interest rates indicating growing market confidence in the new government's ability to handle its finances.

The Treasury sold euro1.4 billion ($1.82 billion) in three-month bills Tuesday with the average yield at 1.3 percent, down from 1.7 percent in the last such auction on Dec. 20.

It sold euro1.1 billion ($1.43 billion) in six-month bills at 1.8 percent, down from 2.4 percent.

Demand was nearly six times the amount offered.

Spain's borrowing costs have dropped since the conservative Popular Party won elections in November. The European Central Bank's injection of cheap money into the market and regular purchases of Spanish debt have also eased pressure.