Spanish bond auction is a success

This morning, the Spanish government initiated its bond auction process this year. The auctions were a success with the yield on 10-year government bonds falling to 4.95%, below 5% for the first time since March 2012. According to Reuters, Spain sold 5.82 billion euros of bonds maturing in 2015 bonds "and re-opened 2018 and 2026 debt". So this is medium to long-dated paper.
Reuters makes the crucial point that the auction for bonds maturing n 2015 is for two-year paper that ostensibly falls under the auspices of the OMT program that the ECB initiated last year. So this paper is backstopped and we can expect good demand for it as a result. It is the fact that demand for longer-dated paper was high and that the ten-year yields are falling that makes this auction such a success. The German-S...

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