The sale’s bid-cover ratio was 2.19, down from 2.32 in the 15 May auction. Greece paid a yield of 4.31 per cent, down from 4.34 per cent in the previous auction, the debt agency said.
Monthly T-bill sales are Greece’s sole source of market funding. Greek banks traditionally buy the bulk of the T-bill issues, meaning funding costs do not fully reflect market strains.
Yesterday’s auction will fund the rollover of a previous €1.6bn issue that falls due on 22 June.
The Greek government’s expenditure on interest payments has reached an astonishing 20.7 per cent of GDP, according to Raj Badiani of IHS Global Insight.
“If EU leaders think that the outcome of the Greek election – even the formation of a government of salvation is anything but a poisoned chalice, they delude themselves,” commented David Buik of BGC Partners yesterday. “Greece is condemned. It cannot meet its financial obligations and never will be able to.”