Cost of state borrowing falling

INVESTORS are taking a more favourable view of the Irish economy due to Government action in the budget, resulting in a fall in the cost of state borrowing.

That trend is set to continue and it is predicted the extra yield investors demand to hold Irish bonds could fall by 0.5% within weeks.

Commerzbank AG said yesterday that the tough measures Ireland has taken and its ability to cope on its own with its budgetary problems should see the yield differences fall further.