We need your help now

Support from readers like you keeps The Journal open.

You are visiting us because we have something you value. Independent, unbiased news that tells the truth. Advertising revenue goes some way to support our mission, but this year it has not been enough.

If you've seen value in our reporting, please contribute what you can, so we can continue to produce accurate and meaningful journalism. For everyone who needs it.

EFSF chief executive Klaus Regling: the EFSF sold €1.5bn of six-month bills today at a low interest rate. Ng Han Guan/AP

EU bailout fund overcomes downgrade with successful bond auction

The EFSF sells six-month bills with an average interest rate of 0.2664 per cent – despite being downgraded yesterday.

THE EU’S BAILOUT fund has successfully raised €1.5 billion from the bond markets this morning through an auction of six-month bills – commanding competitive interest rates despite being downgraded just yesterday.

The European Financial Stability Facility sold €1.501 billion of six-month bills with an average yield of 0.2664 per cent, and demand standing at over three times the amount on offer.

In a brief statement the EFSF underlined that the low yield of its bonds was helped by the fact that its bills (short-term bonds) commanded the top credit rating with Standard & Poor’s, Moody’s and Fitch.

Yesterday’s downgrade by Standard & Poor’s reflected only the EFSF’s long-term bonds, which it has taken out in order to fund the bailouts of Ireland and Portugal.

Today’s auction was the second bill issued by the EFSF: it issued a three-month bill last month with a yield of 0.222 per cent.

Spain raises nearly €5bn in successful short-term bond auction

Bailout costs likely to rise after S&P downgrades EU fund

Readers like you are keeping these stories free for everyone...
A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article. Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation.