Fernando González Urbaneja | In recent years the European Central Bank, in addition to ensuring price stability (an objective it has achieved), has tried to sustain and stimulate the euro economies by supplying all the credit necessary and at the lowest price imaginable, practically zero. States have benefited from this policy by issuing debt at no cost, even with a few tenths of a yield. The ECB has done its…
Bankinter | The Treasury announced on Monday its Financing Strategy for 2022. The Treasury ended 2021 with total Gross issuance of €264.312 billion and Net issuance of €75.138 billion, -25% below the proposed target and -31.6% below 2020 net issuance. The average cost of debt issued amounted to -0.04% and that of outstanding debt stood at 1.64% (from 1.86% at the end of 2020).
The financial wealth of Spanish households increased by 5.1% in the last year to stand at 214.1% of GDP. The Financial Accounts of the Spanish Economy, published by the Bank of Spain, show that consolidated corporate and household debt reached €1.673 billion in the second quarter of 2021 (144.2 % of GDP), 1.8 % above the €1.644 billion recorded a year earlier (140.5 % of GDP). The increase in the…
According to data from the Bank of Spain (BdE) released on Friday, the debt of Spanish public administrations as a whole rose in Q1’21 to 1.392,733 trillion euros, a record high. This figure represents 125.3% ofof Spain’s Gross Domestic Product (GDP). In the last year, public debt has increased by 168.213 billion euros, which represents an increase of 13.7%. It should be recalled that at the end of 2020 this…
After issuing €1,62 bn at 5 years, €1,31bn at 10 years and €510 M at 30 years, the Treasury ruled out any further debt issuances in 2019. On the other hand, the net issuance amounted to almost € 20 bn, the lowest figure since 2007.
From 2019 it is possible that Spain will have difficulties financing its public debt, which is definitely not only the official figure of 98.3% of GDP. Rajoy’s increase of this debt by €649 billion has been financed at very low interest rates, thanks to the ECB’s quantitative easing. On the other hand, Pedro Sánchez has announced substantial spending increases, which will inevitably increase debt in 2019.
Investors’ fears and their hunt for safe haven assets are having an unsuspected impact on European public debt yields: nearly two thirds of these securities are in negative territory; the German bund is beating a new record low on a daily basis and Spanish debt is approaching the minimum levels recorded in April 2015.
UBS | In this report, we focus on three pivotal questions that we consider crucial for investing in any security in Spain: First, what is the economic outlook for 2016/17, and what are the biggest economic policy challenges that the next government will face? Second, what are the likely scenarios for the outcome of the elections on 26 June? And third, what is the valuation and relative attractiveness of Spanish assets, how will asset markets react to different election outcomes, and what is or is not priced in?
The current uncertain political panorama in Spain after the December 20 elections has not been reflected in any significant way in sovereign debt spreads. The yield on the 10-year bond compared with the German bund is around 130 bp, no more than 10-15 bp above the pre-elections level. One alternative to reduce (or diversify) exposure to Spain’s public debt may be take positions in Italian debt.
The Spanish Treasury sold €2.102 billion worth of bonds at its last auction of the year, meeting its issuance target for 2015 of €139 billion. Its average issuing period in 2015 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%.