The demand for Portuguese debt issued this Tuesday has reached 15-year highs, indicating the confidence investors have in the country, stated the Finance Minister on Wednesday.
The Portuguese State issued 5 billion euros in syndicated debt issuance in bonds maturing in approximately eight and 29 years, an operation that “benefited from strong participation, with demand being 13 times higher than the offer for the shorter maturity and 23 times more for the 30-year line, something not seen since 2010,” highlighted the Ministry of Finance in a statement.
For the eight-year bonds, 3.5 billion euros were issued, with a coupon rate of 2.875% and a yield of 2.961%, and demand exceeded supply by 13 times, according to the IGCP — Agency for Treasury and Public Debt Management.
For the 29-year bonds, the Portuguese State issued 1.5 billion euros, with a coupon of 3.625% (and a yield of 4.045%), with demand 23 times the amount placed.
The Minister of State and Finance stated, as cited in a communiqué, that “these numbers, along with the recent rating upgrades by Fitch and S&P, reflect the confidence investors currently place in Portugal.”
“This confidence is further reinforced by the accounts released yesterday by the National Statistics Institute, which indicate a downward revision of the public debt ratio, as well as the maintenance of the budget surplus,” added Joaquim Miranda Sarmento.
The Ministry responsible for public finances also emphasized that Portugal is “increasingly well regarded by foreign investors, who in this operation accounted for about 85% of the demand in the case of the eight-year bonds, and almost 90% for the 30-year titles.”
The IGCP also noted on Tuesday that “this strong demand allowed the Republic [of Portugal] to comfortably execute its transaction.”
The financial rating agency Fitch upgraded Portugal’s rating from A- to A, with a stable outlook, on September 12, while S&P raised the sovereign debt rating to ‘A+’, with the outlook changing from positive to stable, on August 29.
[Updated at 3:03 PM]
