The Spanish treasury sold on Thursday 4.57 billion euros (5.99 billion U.S. dollars) in treasury bonds, paying lower borrowing costs than in the previous auction.

Illustrative image. (Source: Internet)

Particularly, a total of 1.86 billion euros worth of bonds with a three-year lifespan carried an average interest rate of 2.247 percent, which is below the 2.792 percent of the previous auction.

A further 1.55 billion euros' worth of bonds with a five-year lifespan fetched an average interest rate of 2.789 percent, compared to the 3.357 percent of the previous auction held last April. This is the first time since 2010 the five-year bond interest rate has fallen below 3 percent.

The auction could be considered a success as the Spanish treasury once again placed more debt than the predicted 4 billion euros, while the risk premium in the Spanish secondary market remained below the 300 point mark at 289 points.

Two weeks ago, the Spanish government had lowered its economic forecasts predicting a GDP contraction of 1.3 percent for 2013 compared to the previous 0.5 percent. The government expects Spain will grow by 0.5 percent in 2014. (1 euro = 1.31 U.S. dollars)

Source: Xinhuanet