Portuguese sovereigns under pressure
The decision by the European Central Bank to hike interest rates by quarter of a percent last week has put pressure on the yields bond investors expect back from the Portuguese State,
The interest rate on two-year bonds jumped up to a 10-year maximum with Portuguese bonds having an interest of 3,305%, up 20 base points, the highest since December 2013 according to Reuters.
Yields on 10-year treasury bonds increased 12 base points to 3.448%. Sovereign bonds issued by most Euro Zone countries were equally under pressure over the interest rate increase and fears of recession.
According to business title Negócios, the Portuguese body responsible for issuing and auctioning public debt, the IGCP, has cancelled an issue of short-term bonds scheduled for September 20 in which it hoped to raise around €1.2Bn (6 months) and €1.5Bn (12 months) respectively.
However, Portugal did raise just over €1Bn in long-term bonds through two auctions of nine and 12 year issues. (€485 million and €522 million respectively)