Monday, March 1, 2010

Greece puts bond sale on hold

Greece has put its planned bond sale on hold amid expectations that further support from European countries will cut the premium investors demand to lend money to the troubled country.

"Normally they would test the market but now nothing has been fed [into the market] it's all on hold," said Ashok Shah, chief investment officer of London & Capital, a sovereign bond investor.

Greek officials insist, however, that Greece does "not have to access the market any time soon". Petros Christodoulou, head of the country's public debt management office, told the Guardian: "This allows us to access it when conditions are favourable for the benefit of the Hellenic republic and our investors."

Greece had planned to raise €5bn, as it needs to refinance €20bn before the end of May, but changed its mind after reports of German resistance to any potential bailout.

The Greek prime minister, George Papandreou, is to meet Germany's Angela Merkel on Friday, hoping to gain more support from Europe's largest economy.

"It's likely they will wait until after the Merkel meeting," said Elisabeth Afseth, a credit analyst at Evolution Securities. "It might be a bit suspicious if they came tomorrow saying they were raising money, just before a big announcement."


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