Spanish yields fall and Ireland hits zero as low TLTRO take-up hints at QE

Spain wiped nearly 13bp from its three year borrowing costs at auction on Thursday, while investors lent Ireland three month cash for free. But periphery yields may have even further to fall, after take-up at the European Central Bank’s first targeted longer term refinancing operation (TLTRO) fell below analysts’ expectations, suggesting the central bank might have to dip into its dovish box of tricks once again.