ECB holds almost 50% of Portugal’s debt

 In Banks, Bonds and Gilts, Government financing, News, Public debt

The European Central Bank’s decision to buy up increasing quantities of Portuguese sovereign bonds has resulted in the ECB now holding 46% of Portugal’s public debt.

According to calculations made by Público, the impact of the pandemic on Portugal’s budgetary requirements was considerable as the State’s financing needs skyrocketed in 2020 and 2021 resulting in the Portuguese treasury issuing more government bonds to raise money from the international markets.
Nevertheless, interest rates on Portuguese bonds have not risen because the ECB through the Bank of Portugal, bought a lot of it.
Between March 2020 and the end of June 2021 net purchases of Portuguese public debt by the Bank of Portugal stood at €33.26Bn, an amount that is more than double the net issue made by the Portuguese State for the same period in 2020.
According to calculations made by the newspaper and based on information from the ECB and Portuguese treasury, the BoP and ECB holds 46.1% of Portuguese treasury bonds. In February 2020 this percentage was 28.1%.
Considering the value invested in treasury bonds and debt held by the EU’s official creditor, the amount by the end of July was 27.2%.