Portugal's Debt Management Agency (IGCP) successfully exchanged three bonds totaling €6.6 billion that are set to mature in 2014 and 2015. Subsequently, the yield on Portugal's ten-year government bonds fell by 11 basis points to 5.89%, and the yield on five-year government bonds decreased by 22 basis points to 4.89%. The yields on the exchanged bonds were 4.677% (maturing in 2017) and 4.956% (maturing in 2018).
This operation aims to alleviate the debt repayment pressure on the Portuguese government in the coming two years and is viewed by the market as a test for Portugal's issuance of new bonds early next year. The results indicate that investors responded positively to Portuguese government bonds, laying the foundation for Portugal's complete restoration of market financing capabilities after exiting the bailout program next year.
Source: Economic and Commercial Office of the Embassy of China in Portugal
