Sovereign bonds – Portugal underestimated borrowing needs

Portugal has already issued more bonds so far this year than anticipated for the entire year.

On Tuesday, the country’s Public Debt & Treasury Management Agency (IGCP) sold €5Bn of new debt in eight to 30-year bonds – the third operation of this type so far this year.

Two weeks ago at a parliamentary hearing of the Budget, Finances and Public Administration Commission, the President of the IGCP, Pedro Cabeços, revealed that the institute has geared its bond issues to a “diversification of its investor base”.

He highlighted bond holders’ confidence, saying that “we are in a much better position position than we were several years ago” and added that bond investors were preferring Portugal to France because of the political crisis there.”

The IGCP has carried out its first large-scale test of the market with the sale of €5Bn of treasury bonds in the third syndicated sale of the year – the first in January was the sale of 10-year bonds worth €4Bn, and the second was in April with the sale of €3Bn in 15-year bonds. Together with the auctions to be carried out on Thursday, this brings the total value of bonds issued so far this year to €21Bn, compared to the €20.5Bn foreseen for the whole of 2025.

Source: Negócios.