Greece joins the circle of negative borrowers – Economy


Prime Minister Kyriakos Mitsotakis rejoiced in Parliament: "I was informed a few minutes ago that Greece had borrowed at a negative rate for the first time in its history." On Wednesday, Athens is in debt to – 0.02% on securities to three months, a sign that one jostles to lend him. This is an incredible financial revenge for a country leached by three successive rescue plans, which it completely came out in August 2018. At the height of the crisis, its 10-year debt was trading at 40%! A rate as staggering as theoretical, no investor dared then bet on a quick recovery of the (very) weak link in the euro area. Yet Tuesday, the local Treasury has easily drained more than 5 billion euros of capital over the same period, paying a small yield of only 1.5%.

The country promises economic growth of 2.8% next year, which seems optimistic in an environment of strong slowdown in global activity. Those who lend him today do not even pretend to believe it. They simply note that, now well anchored in the euro area, Greece pays its lenders much better than other members of the single currency. France and Northern Europe go into debt at 10 years at negative rates, Italy offers a return of only 0.9%. This is even less so in Spain (0.15%) and even in Portugal (0.13%). And the trend may not improve in the coming months, given the monetary policy announced by the European Central Bank. In this sad universe of zero rates, the search for a small "premium" is well worth a few cold sweats: if the Greek debt attracts lusts and hunters yield is always rated in the category "junk bond ". That is to say, it theoretically presents a significant risk of default.

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