Spain borrowing costs rise over Greek crisis
Madrid, May 14, (PRESSTV), -- Spain’s borrowing costs have once again risen to dangerous levels amid ongoing fears over the country's banking sector and political uncertainly in Europe.
The interest rate for the 10-year Spanish bonds climbed to 6.22 percent on Monday, which had an increase of 33 basis points from the previous close on May 11.
Borrowing costs also rose to 2.985 percent for the 12-month notes and to 3.302 percent for the 18-month bonds. Spain sold 2.9 billion euros worth of bonds, just below its maximum target.
Investors are worried that Spain's public debt might rise sharply after Spanish Prime Minister Mariano Rajoy said that the government may be forced to inject as much as 15 billion euros of public funds into struggling commercial banks, many of them heavily exposed to the collapsed property sector.
Meanwhile in Greece, political deadlock entered a second week after political parties failed to form a coalition government on Sunday, over divisions on painful austerity measures, reinforcing fears that the country was on a path to bankruptcy and an exit from the eurozone.
German government bond yields fell to all-time lows on Monday after opposition parties won the local elections in the country’s most populous state on Sunday, in a development seen as a major blow to Chancellor Angela Merkel’s center-right party.