LISBON: Portugal had to pay increased interest rates to borrow ¤2bn ($2.6bn) yesterday but raised the amount it needed to complete its financing for this year.
“Portugal has succeeded in placing all of the maximum intended amount, which is always good news,” analysts Filipe Silva of Carregosa bank said.
“The rise of the rates is not a surprise to the extent that the rates on the secondary market (for existing debt) have risen in recent weeks,” he said.
The treasury said that it had placed 18-month bonds to raise ¤1.2bn at a rate of 2.990 percent from 2.967 percent on September 19.
It raised ¤500m for six months at 2.169 percent from 1.839 percent, and ¤300m for three months at 1.936 percent from 1.366 percent on October 17.
Demand for the 18-month bonds amounted to 1.9 times the amount on offer, 4.5 times the amount of six-month bonds and 5.1 times the three-month bonds.
The agency had wanted to raise ¤1.75-2bn with the issues which marked the end of the government’s financing programme for 2012.
The issue occurred after auditors from the European Union, the European Central Bank and the International Monetary Fund had expressed satisfaction with action by the government to correct public finances.
Portugal is enacting drastic spending cuts, tax rises and reforms of its economy in return for receiving rescue funding of ¤78bn ($100bn) from the EU and IMF in May 2011.
AFP
