Portugal: €1.49B in bonds auctioned for yields of 2.786% to 3.433%

IGCP auctioned €1.496 billion, below the maximum global indicative amount, in nine, 17 and 27-year Treasury Bonds (OT) at yields of 2.786%, 3.342% and 3.433%, respectively, it announced on Wednesday.

According to the IGCP—Treasury and Public Debt Management Agency page on Bloomberg, €516 million was auctioned in “OT 2.25%—18Apr2034” (around nine years) at a yield of 2.786%, and demand reached €1.084 billion, 2.10 times the amount placed.

In “OT 1.15% – 11Apr2042” (around 17 years) IGCP placed 489 million euros at a rate of 3.342% and demand totalled 930 million euros, 1.90 times the amount placed.

In “OT 1% – 12Apr2052” (around 27 years) IGCP auctioned €491 million at 3.433% and demand totalled €848 million, 1.73 times the amount placed.

Commenting on today’s auctions, Filipe Silva, Investment Director at Banco Carregosa, said that the “rates are within the average levels recorded by Portugal in recent months”.

“We are currently in a context of falling interest rates, however, the longer maturities reflect expectations of several rate cuts by the European Central Bank,” says Filipe Silva, adding that “there may be some volatility, given that the European economy is facing structural challenges, such as high energy costs, declining competitiveness and labour shortages.”

IGCP announced three auctions of nine-, 17-, and 27-year OT, with a total indicative amount between 1,250 million euros and 1,500 million euros.

IGCP has carried out two operations with these securities this year, repurchasing €430 million of OT maturing on 15 October this year at 100.38% on 22 January and placing €4,000 million in a syndicated issue in 10-year OT on 9 January.