An unlikely beneficiary of the fiscal fudge, perhaps. Here’s Spanish 10 year paper, the yield on which was threatening to drop back below 5 per cent on Thursday.
Having raised €97bn from the markets last year, Spain is expected to try and raise another €110bn this year. So there’ll be some cautious optimism right now in Madrid.
Who might be buying Spanish paper?
Well, there was some evidence on Thursday (albeit a little stale) from the ECB that Spanish banks have resumed buying of their sovereign’s paper. They were certainly buying back in November and that’s now looking like a sensible trade.