THE COST OF BORROWING for the Irish government has remained largely flat this afternoon, with international investors apparently unmoved by yesterday’s announcement that €6bn of adjustments would be sought in next month’s Budget.

The rate of interest being asked of Ireland for ten-year borrowings remains close to its all-time record, standing at 7.618% shortly before 3pm this afternoon.

The price had briefly spiked this morning, momentarily exceeding 7.7%, but has fallen away since and now stands modestly under its opening value from this morning of 7.656%.

The modest fall has, however, reduced the Irish-German spread, with the cost of German ten-year borrowing rising moderately too, to 2.419% – which, in tandem with the small Irish gains, leaves the spread at a still-extraordinary 5.2%.

The Irish rises this morning followed the similar rise in Spanish bonds, as investors briefly feared fiscal difficulties in the largest of the beleaguered ‘PIIGS’ economies.

A Spanish default would almost certainly mean that were Ireland to follow, there would be significantly less cash in the European stability funds for Ireland to live off.