Some analysts said a successful Spanish sale could open the door for the crisis-ridden Greek government to launch a 10-year bond after European Union leaders pledged support last week for Athens’ plans to shrink its huge budget deficit but stopped short of financial aid.
Others were more circumspect, though, and stressed that Greek’s deficit problems were far greater than those of Spain and doubted whether there would be sufficient support in the markets to support an equivalent issue.
Bill Blain of Matrix Corporate Capital: “This deal demonstrates that Spain can do deals by paying a significant premium. But Spain is only just on the radar screen whereas Greece is clearly in a different situation.”
Spain’s 15 year €5bn (£4.3bn) bond was attractively priced and won support for twice the amount of bonds on offer. Greece’s public debt is forecast to reach 120 per cent of gross domestic product this year, more than twice the level of Spain’s, although Madrid is also battling a high budget deficit due to the collapse of a property boom.