Greece’s latest 3-month bill auction shows just how little confidence markets have, still, in the nation’s short-term outlook.Some were impressed by apparently high investor demand, but the fact of the matter is that 3-month Greek bills sold at a yield of 3.65%.
As a point of reference, Germany’s 10-year bond yield is 3.11% according to Bloomberg.
Thus Greece is paying far more to borrow for just 3-months than Germany does for 10 years. Yet they both use the euro, and Greece is even widely expected to be bailed out by Germany in some form. Ouch.
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