Bailed-out Portugal raises almost $2 billion in debt auction as longer interest rate falls

LISBON, Portugal – Portugal has raised 1.5 billion euros ($1.94 billion) in a debt auction that saw the bailed-out country’s longer-term interest rate fall, suggesting investor jitters about the financial fate of Cyprus are not contaminating other frail eurozone nations.

The government debt agency said it sold 1.2 billion euros in 18-month Treasury bills Wednesday at a rate of 1.506 per cent, down from 1.963 per cent in January.

It paid a yield of 0.757 per cent to sell 300 million euros of 3-month Treasury bills, slightly up from 0.737 last month.

Portugal needed a 78 billion euro rescue in 2011 when, after a decade of low growth and mounting debts, it was engulfed by the eurozone’s financial crisis.

Austerity measures contributed to a 3.2 per cent economic contraction last year and record unemployment of 17.2 per cent.