Greece managed to place 1.95 billion euros ($2.63 billion) of 13-week T-bills on Tuesday but had to pay paid a high yield of 3.65 percent, up from 1.67 percent in a previous Jan. 19 sale.
The debt-stricken country also announced on Tuesday that unemployment had risen to a six-year high of 11.3 percent in January, from 10.2 percent in December.
Following are some comments from analysts:
NIKOS MAGGINAS, ECONOMIST, NATIONAL BANK OF GREECE
"Conditions in the labour market are deteriorating sharply. The stabilisation observed in December (unemployment figures) seems to have been entirely due to temporary factors. Current trends suggest that the average unemployment rate will exceed 12 percent in 2010."
JENS-OLIVER NIKLASCH, BOND ANALYST, LBBW
"It looks like the T-bill sale was quite successful in terms of them having raised more than they initially planned. But the borrowing cost was quite high. Greece won't be able to cover its financing needs with T-bills. Greece is in a highly dangerous situation, so I expect it is likely that it will apply for help from the IMF and the EU."
DIEGO ISCARO, IHS GLOBAL INSIGHT
"We were expecting high demand for these bonds, as their maturity is very short and the euro zone safety net means that the risks attached are very low.
"On the negative side, the PDMA (Greece's debt agency) still had to pay a very high interest rate. We believe that interest rates might start to ease once the government raises the large amounts needed before the end of May.
"However, the main concern is that this may not happen if the economic situation continues to deteriorate and investors lose faith in the government's ability to bring the public finances to a sustainable path in the long run."
"As expected, unemployment jumped in January. This is obviously not good news for consumers, which are already being hit by higher taxes and less availability of credit.
"Going forward, we expect the labour market to continue to deteriorate in the coming months, as a result of plunging demand, large spare capacity levels and an increasingly worrying economic outlook.
"This is a worrying sign for the Greek economy, as private consumption makes up more than 70 percent of Greece's GDP."
