Italy pays lower rate in short-term bond sale

[October 29, 2012]  ROME (AP) -- Italy saw its borrowing rate drop in an auction of six-month bonds in which it easily raised euro8 billion ($10.3 billion).

The government paid an interest rate of 1.347 percent in the sale Monday, down from 1.503 percent last month. The demand was a healthy 1.52 percent times the amount on offer, up from 1.39 percent in September.

The government's need to borrow on bond markets has eased since it raised euro18 billion -- far exceeding expectations -- in an auction earlier this month that targeted retail investors.

Italy's high level of public debt has worried global investors over the past few years. Those concerns have eased in recent weeks thanks to a new European plan to help indebted countries lower their borrowing costs and broad reforms by the government.

[Associated Press]

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