Spain's Treasury paid the highest average yield since the birth of the euro to issue 12-month bills on Tuesday in a key test of investor appetite for debt from a country many believe will soon be forced to apply for international aid.
Madrid issued 3 billion euros ($3.77 billion) of 12- and 18-month bills, at the top end of its target. The yield for the longer-dated paper was the highest since November when election uncertainty in Spain and global market jitters pushed yields on the same bill to 14-year highs.
The Treasury sold 2.4 billion euros of the 12-month T-bill at an average yield of 5.074 percent, compared with 2.985 percent at the last auction for debt of this maturity in May.
The paper was 2.2 times subscribed compared to 1.8 last month.
Spain sold 639 million euros of 18-month paper at an average yield of 5.107 percent after 3.302 percent last month, with bid-to-cover ratio at 4.4, up from 3.2 in May.
Spain faces a harsher test of investor appetite on Thursday when it auctions up to 2 billion euros maturing in April 30, 2014, July 30, 2015 and July 30, 2017. - Reuters