by Kerin Hope & Kate Allen
November 30, 2018
Greece has quietly postponed a landmark bond sale after the prolonged sell-off in Italy’s bond market pushed up its cost of raising new debt.
The nation’s leftwing Syriza government had hoped to issue a benchmark 10-year bond within a few weeks of the country’s exit from its €86bn third bailout in August, as a signal to investors that Greece had returned to normalcy.
But the rise in Italian bond yields has rippled through into Greek markets, pushing the Greek 10-year yield well above 4 per cent, double that of Portugal, to what Athens bankers called “impossible rates”.
In response, the government has allowed its bond sale to lapse.