Ireland makes first foray back to bond markets
Thursday 05 July 2012
EU officials welcomed Ireland’s first foray back to bond markets, on 5 July, with ECB President Mario Draghi saying the successful auction of €500 million in three-month treasury bills was “one of the various factors that are making the financial environment nowadays a little less tense than it was a month ago”. The bills sold at an average rate of 1.8% - lower than the 2.3% Spain paid to issue three-month bills, on 26 June. The move was a first test of markets after Ireland secured assurances in last week’s eurozone summit communique that its bank debt - which tops €63 billion - would be re-examined to make it more “sustainable”. Ireland entered an EU-IMF bailout programme in November 2010, borrowing €67.5 billion to fund a deficit that exploded on the back of multiple bank failures. Economic Affairs Commissioner Olli Rehn said the auction “reflects growing international confidence” in Ireland’s bailout. Portugal and Greece have continued to go to the market to sell short-term papers during their bailout programmes.