* Spain sells 3.1 billion euros of new 9-month bill
* Yields down 20 basis points on the 3-month bill
* Auction comes before triple-bond sale on Thursday
MADRID, Feb 19 Spain sold another 4 billion
euros ($5.3 billion) in short-term debt on Tuesday, borrowing
the maximum it had targeted ahead of a triple bond auction on
The sale, focusing on a new 9-month bill, adds to a flood of
borrowing by the countries at the centre of the euro zone's debt
crisis at the start of this year, facing down nerves around
Italian elections at the end of this week.
The Treasury sold 3.1 billion euros of the new 9-month
bills, which replace 18-month debt, at an average yield of 1.144
percent and a bid-to-cover ratio of 2.3.
It also placed 886 million euros of 3-month bills at an
average yield of 0.421 percent, slightly lower than the 0.441
percent when it last sold in January.
"Despite the mounting political and economic risks, and
increasing concerns about the relatively high level of issuance,
demand for Spanish paper continues to hold up and sentiment
remains favourable," said Nicholas Spiro, managing director of
Spiro Sovereign Strategy in London.
Investor concerns over Spain's finances have eased since the
European Central Bank said it would buy the debt of struggling
countries seeking help last summer.
Madrid is likely to report a budget shortfall of around 7
percent of gross domestic product for 2012, above an EU target
though Brussels has applauded government efforts to keep down
the deficit in the face of a deep and prolonged recession.
A corruption scandal involving the leading People's Party
and the upcoming election in fellow struggler Italy has also
failed to dampen investor appetite.
The premium bond traders demand to hold Spanish over German
debt stood at around 360 basis points on
Tuesday, a long way from euro-era highs last July of over 650