Spanish Sovereign

Greece heads to the polls over the weekend for its second parliamentary election this year, but there is little concern of the plebiscite rocking markets like the earlier vote in January.

Spain’s borrowing costs dropped in five years but rose in threes and 10s at an auction on Thursday, as Italy shelved its BTP Italia product for the year.

Spain kicked off a busy week for the eurozone periphery with a bill sale where the sovereign’s borrowing costs repeated their pattern for much of this year by bumping around 0%.

Italy’s borrowing costs dropped across the curve at an auction on Friday, although its yields at the longer end are still some distance from the euro-era lows hit earlier this year.

Greece’s part in the eurozone sovereign debt crisis has always been secondary to the potential for disaster in larger countries like Spain. Now the latter country could be just months away from breaking up and a huge debt shock. Why does no one care?

Spain’s 10 year borrowing costs rose at an auction on Thursday to more than double their low for the year so far.

Spain’s 10 year borrowing costs dipped below 2% on Thursday for the first time since May, as the sovereign approached the three quarter mark on its funding schedule for 2015.

Spain slashed its one year borrowing costs at auction on Tuesday but the yield was still higher than the lowest level the sovereign has achieved so far this year.

Spain could be set to record its lowest borrowing costs at a 10 year auction since May if its yields hold steady this week, after its levels tumbled in secondaries on Monday.

Spain raised just shy of its maximum target at auction on Thursday, as polls this week in Spain suggested support is declining for anti-austerity party Podemos ahead of elections later this year.

Spain’s three month borrowing costs dipped back into negative territory and to a record low on Tuesday, as the eurozone periphery enjoyed a strong run of trading before Portuguese auctions later this week.

Italy’s medium to long term yields fell at auction for the first time in four months on Monday, as Greece struck a deal with its creditors — but there could be even greater gains ahead for the eurozone periphery.