Bonds: Spain and Italy see expensive auction

Date: Tuesday 26 Jun 2012

These were the yields and basis point movements of some of the most watched 10-year bonds just before the close in Europe:

Spain: 6.87% (+23bp)
Italy: 6.18% (+17bp)
France: 2.63% (+6bp)
Germany: 1.5% (5bp)
UK: 1.68% (+1%)
USA: 1.61% (+1bp)

Bond auctions in both Italy and Spain pushed yields higher for the under-pressure euro area nations on Tuesday.

Italy sold nearly €3bn worth of zero-coupon securities with a 2014 maturity. The yield was 4.71%, versus the 4.04% seen at a similar auction at the end of May,

Spain sold €3.08bn in three-month bills for a yield of 2.36% compared to 0.85% in May.

Investors are looking to a European summit later this week for clarity on the next phase of the official response to the ongoing crisis. They are looking more in hope than expectation.

BS

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