Italy's cost of borrowing increased at a debt auction on Tuesday amid growing concerns whether the country would be the sixth euro area nation to seek a bailout.
The Italian Treasury raised EUR 2.99 billion from the sale of its zero coupon May 2014 bonds, broadly in line with the maximum target of EUR 3 billion. The auction attracted bids totaling EUR 4.94 billion.
The yield on the zero interest debt rose to 4.712 percent from 4.037 percent in the previous sale on May 28. The bid-to-cover ratio, which reflects demand, dipped slightly to 1.65 from 1.66.
The agency also sold EUR 625.5 million of its 2.10 percent September 2016 inflation-linked bonds against the maximum target of EUR 1 billion. The yield on the debt climbed to 5.20 percent from 4.39 percent in the previous tap on May 28. Investors bid 2.22 times the offer compared to 2.29 times in the May sale.
The country also placed EUR 289.5 million of its 3.10 percent September 2026 inflation-indexed bonds, which was first issued in June last year via a syndicate of banks. The maximum target set for the sale was EUR 1 billion. The yield was 5.29 percent and the bid-to-cover ratio 2.43.
by RTT Staff Writer
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