6 Jan 2012

New bonds sold by France

9:48 am on 6 January 2012

France has successfully raised 7.963 billion euros ($10.23 billion) in new long-term bonds.

But concerns about eurozone sovereign debt persist, as the euro fell to its lowest in 16 months.

It was France's first auction of 2012. Demand was solid with the sale nearly twice oversubscribed.

The rate on the 10-year bond rose to 3.29%, up from 3.18% during the last long-term bond issue in December.

Deutsche Welle Radio reports the auction was viewed as a test of market sentiment.

France met its target of raising at least 7 billion euros from the bond sale.

But a sterner test of investor sentiment on sovereign debt in the eurozone is yet to come. Spain and Italy are due to issue bonds next week.

On Thursday, Spain admitted that the country's banking sector was in need of an extra 50 billion euros to provide for bad loans.