Spain Auctions Off €2.999 Billion 15 Year Issue Above 5% Yield

Tyler Durden's picture

The just completed auction of Spanish 2025 Obligacions for just under €3 billion, came at a 5.116% yield, a substantially worse level than the last auction as of April 22, which was placed at 4.434%. The only redeeming feature was that the bid to cover increased from the prior 1.79 to 2.575, after €7.722 billion worth of bids noted an interest. Somehow we get the feeling the ECB has been busy this time around, as have been the Chinese, which were instrumental in last week's 10 Year auction. According to Market News, "Spain is "very confident" it will meet its forthcoming July redemption payments, given its cash position at the Bank of Spain." Furthermore, tax receipts are running in line with  expectations, adding to the positive feeling. This is all wonderful, and occurs on the back of a just released Barclays report which (to be posted shortly), which notes that Spanish Cajas alone will likely require €36.2 billion euros to plug a capital shortfall. Luckily the ECB and China are more than happy to keep providing the funds necessary to plug this hole, which upon third, fourth and fifth reestimations will likely end up being one zero short of the true capital deficiency.

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papaswamp's picture

All is well ..market up since the magical Chinese GDP is over 10%...who cares if the lesser countries default.

Abiggs's picture

Euro is rallying like there's no tomorrow;ES is closely following and is DX sliding to 83.

PPi, Jobless Claims, and the other rolling over US indicators can only save the dollar...

HelluvaEngineer's picture

Can someone please explain to me why the Euro is still so strong? 1.2844 currently

Abiggs's picture

A series of successful Spanish and Greek auctions...

luigi's picture

Because the presses at BCE still haven't the astonishing output force of the ones running at the FED h24/7-7?

 

dan22's picture

The latest ESRI Quarterly Economic Commentary projected that the 2010 general government balance will be a deficit of 19.75 percent of GDP, which is the sum of the ‘underlying’ deficit of 11.5 percent of GDP and the capital transfer into Anglo/INBS of 8.25 percent of GDP. In short, the government will need to raise more taxes and/or cut spending.

The Coming Euro Collapse- The Irish Budget Deficit is Projected to be 19.75% of GDP!

Grand Supercycle's picture

 

As warned about for some time... EURUSD daily chart is bullish.

http://stockmarket618.wordpress.com/about

herry's picture

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