The instability caused by recent political scandals in Spain has hindered the Treasury's bond sales. For the first time this year, its interest rates have risen, breaking a long-standing downward trend.
The rate hike was logical, given the rising risk premium that seemed to have stabilized around 380 basis points. We can't forget that last Friday the spread between the German bund and the Spanish risk premium was 351 basis points. But even at these interest rates, investors are still hungry for Spanish debt, and the Treasury was able to meet its debt issue goal. Rajoy should take notice of the noise in the markets and make an effort to stop corruption and lobby for Ana Mato's resignation.
