Short-Term Auction (Letras): February 11, 2025
On February 11, 2025, the Spanish Treasury held a short-term auction for Letras, which are government securities with a maturity of less than one year. The auction was conducted through the Bank of Spain’s online platform, and a total of €3 billion was raised.
The auction was divided into two tranches:
- Tranche 1: €2 billion of 6-month Letras
- Tranche 2: €1 billion of 9-month Letras
The 6-month Letras were issued with a coupon rate of 1.15%, while the 9-month Letras were issued with a coupon rate of 1.25%. The average yield for the auction was 1.18%.
The auction was well-received by investors, with total demand reaching €4.5 billion. This suggests that there is strong demand for Spanish government debt, even in the short-term.
The proceeds from the auction will be used to finance the Spanish government’s budget deficit. The deficit is expected to decline in the coming years, as the economy continues to recover from the COVID-19 pandemic.
Additional Information:
- The Spanish Treasury holds short-term auctions on a regular basis, typically once or twice per week.
- Letras are an important funding source for the Spanish government, and they are typically issued with maturities of 3, 6, and 12 months.
- The interest rates on Letras are determined by market conditions, and they can fluctuate over time.
- Investors can purchase Letras through their banks or through online brokerages.
Short term auction (Letras): 11 February 2025
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