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.