Record low bond interest rate

Greece successfully tapped the bond markets yesterday for the third time within 2021, as its five-year issue drew bids of more than 20 billion euros and secured a very low interest rate of just 0.20%, down from an original guidance for 0.28%.

In Greece’s third market foray this year, the Public Debt Management Agency (PDMA) raised €3 billion, capitalizing on the country’s recent credit rating upgrade by Standard & Poor’s.

Finance Minister Christos Staikouras commented yesterday that this record low interest rate constitutes yet another vote of confidence in the Greek economy and its prospects, noting that the previous five-year issue, by the government of Alexis Tsipras in 2019, had reached a 3.6% interest rate. “Today’s issue also had a major coverage ratio and an excellent quality,” he said referring to the origin of the bids submitted.

Also yesterday the PDMA raised another €812.5 million, set to become €1 billion by today with non-competitive bids, through the issue of new 13-week treasury bills at a negative interest rate of 0.40%, also a historic low, from -0.32% in the previous such auction on April 7. The issue enjoyed a coverage ratio of 1.98.