Huge investor demand for Greek five year bond

GREEK CAPITAL MARKET

Greece is to return to the capital markets for the first time in five years over subscribing the sale of long term debt by the Greek government eight times.

Greece's deputy prime minister Evangelos Venizelos said demand for 3bn euros (£2.4bn) worth of five year bonds proved the country's debt is sustainable.

The sale attracted interest from 550 investors.

Greece is retuning to the capital markets for the first time since its economy nearly collapsed in 2010.

The Greek government had initially priced the bond to provide a return of between 5% and 5.25%.

But with investor orders running at 20bn euros (£16.5bn) it was able to lower the yield to 4.95% - far lower than analysts had expected.

The country still has a "junk" credit rating, nine notches below investment grade at Caa3 by Moody's.

Standard and Poor's and Fitch rank Greece six notches below investment grade at B-.