Greek borrowing costs fall at treasury-bill sale

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Greek borrowing costs fall at treasury-bill sale

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Investors are definitely warming to Greek debt.

On Tuesday Athens was able to borrow money – repayable in six months’ time – at the cheapest interest rate since its debt crisis began in early 2010.

The yield was 3.01 percent, down 0.59 percent from a similar auction in March.

In addition most of the buyers of the 1.3 billion euros worth of six-month treasury-bills were from outside Greece – around 80 percent according to a debt agency official.

Foreign take-up of treasury issues in the last three months had hovered at around 40 percent.

These short-term T-bills are Athens’ sole source of market funding; for longer term borrowing it is reliant on EU and International Monetary Fund bailout money.

The sale is encouraging for Greece’s planned return to longer-term bond markets sometime in the first half of this year.

The country is looking to sell about two billion euros of five-year bonds, according to government and banking sources, in its first foray into bond markets since the first of its two international bailouts in 2010.

No hurry says Stournaras

Greece does not need to return to debt markets imminently, its finance minister said this week.

“There is absolutely no rush, nor is it a precondition, to do this before Easter (April 20)”, Finance Minister Yannis Stournaras said in an interview on Greek radio station Vima FM.

Stournaras’s comments follow media speculation that a sale could take place as soon as this week.

They also come two days after the head of the eurozone’s bailout fund, Klaus Regling, warned Athens not to pay investors too high a yield, to avoid increasing its debt load.