With the instability of the markets, Portugal has to pay to issue Treasury bills (T-Bills).
Portugal obtained this Wednesday 1,250 million euros through two auctions of short-term debt securities. However, due to the instability of the markets due to the Covid-19 Pandemic, the IGCP once again registered a positive interest rate to issue Treasury Bills (T-Bills), something that had not happened since the end of 2016.
In the three-month T-Bills, the IGCP obtained 410 million euros, with interest standing at -0.09. It is a much less negative rate than that recorded in the previous comparable auction: it compares with the rate of -0.5% recorded in the February auction. Demand was 2.53 times higher than it was issued.
But it was in the 11-month line that there was a reversal, reflecting investors’ nervousness about the current situation of the Covid-19 Pandemic: this time, Portugal had to pay an interest rate of 0.038% to finance itself with 840 million euros in T-Bills maturing in March 2021, when in the last comparable auction, held in February, the rate was -0.484%. In this case, market demand was slightly higher than what the IGCP actually issued: it was 1.38 above supply.