Greece tries to raise money on bond markets after upgrade

ATHENS, Greece (AP) — Greece successfully launched its first 10-year bond auction since 2010 on Tuesday, as it seeks to gradually regain the confidence of international investors and wean itself off bailout funds.

Prime Minister Alexis Tsipras said the issue attracted strong interest from investors, showing that the country has left behind the bitter crisis era when it was shunned by markets and flirting with bankruptcy.

“Bids are at an admirable level, and this is an indication of hope,” Tsipras said. “It’s a sign that we are turning a new page and exiting the crisis era.”

The Public Debt Management Agency said Greece raised 2.5 billion euros with a yield of 3.9 percent in the heavily oversubscribed auction that attracted bids worth 11.8 billion euros.

The debt issue came at an opportune moment for Greece, as its yields hover around their lowest in more than a decade after Moody’s ratings agency raised the country’s credit rating by two notches. While still well below investment grade, its B1 classification marks a vast improvement for a country that was in default at the worst of the crisis.

Trending:
Trump Responds to 19K Fulton County Absentee Ballots Missing Chain of Custody Docs

The results of the bond issue were expected to be announced later Tuesday.

It was Greece’s second foray into capital market financing since the end of its third, and last, bailout program in August. The government raised 2.5 billion euros ($2.85 billion) through an oversubscribed five-year bond in January.

The country was priced out of capital markets after revealing it had for years misreported public debt figures and signed its first bailout deal in mid-2010. In exchange for the rescue loans, successive governments were forced to make deep income cuts and tax hikes, while radically reforming the economy.

The austerity deepened an economic recession and caused a sharp fall in living standards — with the average incomes dropping by a third and unemployment spiking to a postwar record of 28 percent. It’s now 19 percent.

Tsipras was elected in 2015 on a defiantly anti-austerity platform but was soon obliged to reverse course and sign up to the third bailout — and even more austerity.

His government implemented reforms it had previously opposed and is seen as committed to maintaining course despite a slackening of pace in recent months and a slew of voter-friendly measures as parliamentary elections approach this autumn.

The pro-reform, conservative New Democracy party is leading in all opinion polls ahead of the election.

Greece’s European creditors are due next week to review the country’s progress before deciding whether to release more than 700 million euros in pledged funds.

The Greek debt management agency has said it plans to issue 5-7 billion euros in benchmark bonds this year.

The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.

Truth and Accuracy

Submit a Correction →



loading

We are committed to truth and accuracy in all of our journalism. Read our editorial standards.

Tags:
The Associated Press is an independent, not-for-profit news cooperative headquartered in New York City. Their teams in over 100 countries tell the world’s stories, from breaking news to investigative reporting. They provide content and services to help engage audiences worldwide, working with companies of all types, from broadcasters to brands.
The Associated Press was the first private sector organization in the U.S. to operate on a national scale. Over the past 170 years, they have been first to inform the world of many of history's most important moments, from the assassination of Abraham Lincoln and the bombing of Pearl Harbor to the fall of the Shah of Iran and the death of Pope John Paul.

Today, they operate in 263 locations in more than 100 countries relaying breaking news, covering war and conflict and producing enterprise reports that tell the world's stories.
Location
New York City




loading

Conversation