On Tuesday, the Treasury Ministry auctioned 3 and 9 month notes for 2,318 million euros, slightly below the expected average range of between 2,000 and 3,000 million. The profitability of 9-month bills is close to 2%, while the 3-month bill has remained stable below this figure. Demand for Spanish bonds remained strong, with requests for almost 5.5 billion euros, more than double the final amount granted.
Specifically, the Treasury granted 706 million in quarterly bills, compared to just over 2,000 million requested. The average marginal interest stood at 1.926%, practically equal to the 1.928% recorded in the previous auction of the same reference. In the case of the 9-month bills, 1,612 million were assigned, well below the almost 3,500 million requested, but with a marginal profitability that rose to 1.976%, compared to 1.966% of the previous issue.
The Treasury will return to the markets next Thursday, November 20, with a new issue of securities and bonds at the close of the November auctions. At the end of September, the Treasury reduced its financing requirement for 2025 by 5 billion, bringing the net issuance program to 55 billion, compared to the 60 billion initially expected.
The average cost of outstanding debt remains at 2.28%, just 64 basis points above the 2021 record low (1.64%), and far from the 250 basis point increase in official interest rates over the same period. The average cost of issuance for 2025 until August stands at 2.75%, lower than last year’s 3.16%, which helps to contain the financial weight of the debt on GDP at around 2%.
The Treasury also continued to diversify the investor base and strengthen the green bond market, with the reopening of bonds issued in 2021, seeking a volume comparable to the rest of the curve’s benchmarks and supporting ecological transition projects. In total, 48 ordinary auctions of bills of exchange and bonds and State Bonds are planned, in addition to recourse to syndicates for some issues of State Bonds.
