Interest on 10-year bonds at 1.5%

 In Bonds and Gilts, IGCP, News

The interest rate on Portuguese 10-year sovereign bonds has risen to 1.5% — the highest rate since February 2019.

Interest rates on Euro Zone sovereign debt has risen in recent weeks reflecting the unexpected increase in inflation because of energy costs, the Ukraine invasion and the reopening of the world’s economy following two years of pandemic.
Investors are expecting the European Central Bank to put up interest rates again after having begun to reduce the amount of bonds it is buying from member states.
Nevertheless, Portugal’s public debt and treasury agency IGCP will undertake six auctions of treasury bonds in the second quarter on 20 April, 18 May, and 15 June.
There will be two auctions for three and 11 month bonds on the 20 April to raise €1Bn and €1.25Bn. On the 18 May six and 12 month bonds will be auctioned to raise €1.5Bn and €1.7Bn. Finally on 15 June, the IGCP will issue three and 11 month treasury bonds worth a total of €1Bn and €1.25Bn.
The increase in interest rates on Portuguese bonds took place on the same day that the IGCP contracted a syndicate of banks to issue new 10-year bonds which will cost the State more in interest than comparable issues at the start of the year when the IGCP led by Cristina Casalinho raised €3Bn from 20-year bonds with an interest rate of 1.2%.