French borrowing costs up in $11 bln bond auction

AP News
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Posted: Apr 05, 2012 5:37 AM
French borrowing costs up in $11 bln bond auction

France saw its borrowing costs rise slightly as it sold (EURO)8.44 billion ($11 billion) in a long-term bond auction.

Borrowing costs _ also known as the yield and an indication of risk _ edged up on most of the bonds issued by France Thursday, though demand was healthy and the sale brought in close to the high end of the French Treasury's goal.

The largest issue was of 10-year bonds, for which the yield rose from 2.91 percent to 2.98 percent when it was sold last month.

France has occasionally been hit by investor concerns that its levels of debt are unsustainable. That concern became more acute when Standard & Poor's stripped it of its AAA-rating.

The impact of the downgrade has been limited, but a poor Spanish debt auction Wednesday renewed worries that European economies aren't growing fast enough to keep their deficits in check.