The Spanish Treasury sold €2.102 billion worth of bonds at its last auction of the year. It sold €895 million in 5-year bonds with an average yield of 0.657% (below the 0.71% this bond trades at in the secondary market and compared with 0.437% at the last auction). The bid-to-cover ratio rose to 2.67 vs 2.61 at the previous auction. Furthermore, it sold €606.8 million in 7-year bonds with an average yield of 1.354% (below the 1.43% in the secondary market and compared with 1.184% at the previous auction). The bid-to-cover ratio improved to 2.87 from 2.37. (iii) it sold €600.1 million 20-year bonds with an average yield of 2.72% (below the 2.78% in the secondary market and compared with 1.927% at the previous auction). The bid-to-cover ratio rose to 1.95 from 1.62.
With this auction, the Treasury met its target for the year, issuing €139 billion in 2015. Its average issuing period was 9.1 years, not seen since 2010, and it paid an average yield of 0.87%. This has meant that the average cost of debt in circulation has fallen to a record low of 3.16%.
