Might this be a preview for the US to consider?
Following Wednesday’s auction the yield of a composite of Spanish 10-year bonds jumped 24 basis points to 5.69 per cent, the highest since early January, while the premium demanded by investors to hold Spanish debt over that of Germany rose to 388 basis points, the highest since November.
Spain’s borrowing costs initially tumbled from more than 6 per cent after the European Central Bank late in December, and then again in February, offered unlimited cheap three-year loans to continental banks.
However, the scale of the government budget deficit and Spain’s economic malaise has spooked investors and pushed up bond yields. Spanish 10-year bonds have now traded at a higher yield than Italy’s since early February, after trading at a lower yield during the second half of last year
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