Netherlands got its (very small) sale away in undramatic fashion following the collapse of its government. From Reuters:
The Netherlands sold 1 billion euros of 3.75 per cent notes maturing in 2014 at an average yield on 0.523 per cent and 995 million euros of 4 per cent bonds maturing in 2037 at an average yield on 2.782 per cent.
The yield on the two-year note was 11 basis points lower at 0.40 per cent at 9:15 a.m. London time. The 10-year yield fell four basis points to 2.39 per cent.
So far, so nothing.
While we’re here though, there’s a long term trend that might be worth a look:
Whereas once upon a time, these two friendly neighbours had very similar credit default swap spreads, they decoupled in towards the end of last year and have continued to gap out since. It would seem that the Dutch government’s foibles and ultimate fall have not gone unnoticed in this particular market, as spreads have deteriorated.
For further background on the rivalry with the neighbours, we submit the following:
By David Keohane and Lisa Pollack
Netherlands in turmoil after PM quits – FT