Portugal sells €1.65bn in bonds at higher yields

City A.M. Reporter
Portugal's borrowing costs have risen sharply but less than expected in a bond auction today and the hefty amount sold signals the country should be able to repay its maturing debt this month.

Portuguese bond yields have spiked to euro lifetime highs this week, pushed by a government collapse that has led to downgrades by credit rating agencies and mounting pressure for the it to ask for an international bailout.

The IGCP debt agency sold €1.645bn (£1.5bn) in June 2012 bonds, higher than the initially indicated offer of €1.5bn, with demand outstripping supply by 1.4 times.

The average yield on the June 2012 bond rose to 5.793 per cent from 3.159 per cent in the sale in July. The same maturity yielded over seven per cent bid in the secondary market earlier today.