THE WALL STREET JOURNAL: ATHENS—The Greek Public Debt Management Agency Tuesday sold €1.56 billion ($2.12 billion) of six- and 12-month Treasury bills met with strong demand and reassured investors that it can meet its short-term financial needs.
But the Greek government still finds itself having to pay very high interest rates, which will have to fall rapidly in future bond sales for plans to cut the budget deficit to remain on track.
The offering was the first test of investor demand for Greek government debt since finance ministers of the 16-member euro zone Sunday agreed to lend Greece up to €30 billion in the first year of any aid program, to which the International Monetary Fund is expected to add an estimated €15 billion.
"These auctions will be seen as a positive endorsement of the bailout measures announced over the weekend and perhaps reduce the chances of the support package from the euro zone being activated in the short term," said Ben May, an economist at Capital Economics. "But with bond yields at maturities of two years or more still at least 6%, the government will have to pay a high price to borrow the €40 billion that it needs over the remainder of 2010." >>> Emese Bartha and Nick Skrekas | Tuesday, April 13, 2010
