Belgian borrowing costs down

Short-term Belgian debt issued yesterday was snapped up by investors with yields at 18-month lows, after Belgium’s new government appeared to restore markets’ confidence in its ability to manage its finances. The government sold €2.44bn of three-month and six-month bills, higher than the €2.2bn initially planned. The auction registered an average yield of 0.264 per cent on the three-month bills, down from 0.78 per cent paid last month. The six-month bills sold at 0.364 per cent, down from 2.438 per cent in November. Fears had mounted in November that Belgium – after almost 600 days without a government – would be unable to pay its bills. Yields on 10-year bonds rose close to six per cent, echoing those of troubled nations like Greece and Italy. A six-party coalition formed a government in December.