Forex News – Spain passes sale target in bond auction; euro rises

Important: This page is part of archived content and may be outdated.

Euro edged higher against the dollar as risk appetite remains on during the European trading session today. The single currency got a boost after news that Spain was able to sell bonds above its target range.

The Spanish government sold a total of 2.07 billion euros (USD 2.6 billion) of government debt. Bids exceeded supply 3.29 times, up from a bid-to-cover of 2.56 in a previous auction.

However, yields were higher, pushing up borrowing costs. A sale of 10-year government bonds produced an average yield of 6.04 percent, up from 5.74 percent in a previous sale. Spain also sold bonds maturing in 2014 and 2016.

The Spanish government also sold debt in the secondary market. 10-year Spanish government bond yields fell  0.13 percentage point at 6.14 percent.

The Spanish economy ministry says Spain has covered more than 58 percent of its borrowing needs. This is significant considering earlier in the week the government feared it would be shut out of the capital markets and not be able to sell its debt.

EURUSD  hit a high of  1.2584 at 09:30 GMT from an earlier session low of  1.2539.