State’s borrowing costs drop despite impasse in coalition talks

The costs of borrowing for the State have fallen sharply since the election, defying fears of some politicians and commentators, despite no agreement over a new government.

As the Dáil met yesterday for a second time since the vote on February 26, the yield on the Irish benchmark 10-year bond was trading close to 0.75%.

That leaves the implied cost of borrowing for the State on sovereign debt markets sharply lower from over 0.93% on March 10 — when the new Dáil first convened after the election — and compares with a rate of 0.89% on polling day.