Spanish treasury places €4.463bn on market, interest rates negative

The Spanish treasury on Thursday placed treasury bonds worth 4.463 billion euros (about 5.035 billion U.S. dollars) on the market with the marginal interest rates of five-year inflation-linked bonds at negative rates for the first time in history.

A total of 885 million euros worth of five-year European bonds carried an average interest rate of -0.286 percent, which was below the 0.148 percent of the previous issue, while the marginal interest rate stood at -0.250 percent falling from the previous 0.187 percent.

On the other hand, the Spanish treasury placed three and 10-year treasury bonds worth 3.578 billion euros at higher rates and registered a demand of more than 8 billion euros.

A total of 2.396 billion euros worth of bonds with a three-year lifespan fetched an average interest rate of 0.193 percent, above the 0.333 percent of the previous issue.

The remaining 1.182 billion euros worth of 10-year lifespan bonds carried an average interest rate of 1.882 percent, rising from the previous 1.282 percent.

The auction was marked by the negotiations taking place within the European Union (EU) to reach an agreement over the financial crisis in Greece.

Spain's risk premium fell from 129 points in early trading to around 120 points after the auction.