France sells 2041 bonds at average yield of 3.97pc versus 3.94pc in December. Sells 2021 bonds at an average yield of 2.29pc against 3.18pc in December. But id-to-cover drops significantly to its lowest since October 2010. Some reaction to France's semi-successful €8bn bond auction. Overall it's a pretty solid auction. When you look at things like bid cover and particularly the price action going into the auction, where quite a concession was built in, it's nothing to get excited about. But, at the same time it should be enough to dispel concerns with regards to France's funding capacity for the time being. The French auction results are in. The good news is that France managed to sell nearly €8bn of debt, as planned. The bad news is that demand for its 10-year bonds fell sharply, while the interest rate demanded by investors rose. France sold €4bn of 10-year bonds at an average yield of 3.29%, up from 3.18% at the last auction of this type. The bid-to-cover ratio (measuring the amount of bids tabled versus the debt on offer) fell to just 1.643%, down from 3.046%. In comparison, Germany managed to sell 10-year Bunds yesterday at a yield of just 1.93%.
Access Investments-Building Awareness - European Union-ROMANIA
Thursday, January 5, 2012
France sells 2041 bonds at average yield of 3.97pc versus 3.94pc in December. Sells 2021 bonds at an average yield of 2.29pc against 3.18pc in December. But id-to-cover drops significantly to its lowest since October 2010. Some reaction to France's semi-successful €8bn bond auction. Overall it's a pretty solid auction. When you look at things like bid cover and particularly the price action going into the auction, where quite a concession was built in, it's nothing to get excited about. But, at the same time it should be enough to dispel concerns with regards to France's funding capacity for the time being. The French auction results are in. The good news is that France managed to sell nearly €8bn of debt, as planned. The bad news is that demand for its 10-year bonds fell sharply, while the interest rate demanded by investors rose. France sold €4bn of 10-year bonds at an average yield of 3.29%, up from 3.18% at the last auction of this type. The bid-to-cover ratio (measuring the amount of bids tabled versus the debt on offer) fell to just 1.643%, down from 3.046%. In comparison, Germany managed to sell 10-year Bunds yesterday at a yield of just 1.93%.
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Yesterday, following the announcement of EU sanctions on Iran, I asked whether the EU really had any choice after Obama signed into law US sanctions on Iran and potentially any bank or central bank which dealt with Iran.
My view is that the EU really had no choice and it was far better for the sovereignty of EU countries that the EU appears to be making the decision off their own bat.
Here is a link to a zerohedge story from a few days ago which looks at the consequences of the US sanctions.
http://www.zerohedge.com/news/...
What I think is most interesting is that it is bound to set the 'West' (USA, EU) against the 'East' (China, and Russia). I can't see either China or Russia making the same decision the EU has just made and so that means that Russian and Chinese banks which deal with Iran will face sanctions themselves from the USA.
China and Russia MUST ignore US sanctions if they are to uphold their own sovereignty and the USA MUST then impose sanctions on Russian and Chinese banks if they are not to be seen to be weak.
This Bill is a provocation which is bound to lead to an escalation and not just with Iran but with China and Russia too.
Perhaps it answers the question, how do you default on your biggest creditor when it becomes mathmatically impossible to pay them back ?
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