Cost of bonds for state eases

THE cost of borrowing to the state has eased since the Government put the cost of the banking bailout of €50 billion into the market on Thursday.

The interest rate on 10-year bonds has fallen from 6.74% earlier this week to 6.33%, which means the spread against German bonds narrowed to 400 basis points or 4% from 429bp.

The Irish authorities produced a significant raft of announcements on Thursday to give some clarity on the state’s total financial support for the banking sector, said Dan McLaughlin, Bank of Ireland’s chief economist.