France drew strong investor demand in its first Treasury-bill auction of the year with short-term yields rising only slightly from record lows reached in its last auction of 2011.
The Agence France Tresor public debt management agency issued 8.715 billion euros (7.3 billion pounds) in three lines of short-term BTF bonds, towards the top of the 7.6-8.9 billion euro range it had indicated ahead of the auction.
Despite concerns France could lose its prized AAA credit rating in the coming months or even days, the agency issued 4.5 billion euros at rates close to zero for its shortest line in its last bill auction on December 19 as investors sought to close the year with large holdings of short-term debt.
AFT issued 4.438 billion euros of its 12-week bill maturing March 29 with a yield of 0.023 percent, up from the rock-bottom 0.005 percent it secured at its last BTF auction on December 19.
It also issued 2.202 billion euros in 23-week bills maturing June 14 with a yield of 0.074 percent, up from 0.034 percent at the December auction. It had a bid-to-cover ratio of 2.827.
The yield for some 4.505 billion euros of 45-week bills maturing on November 15 fell to 0.136 percent from 0.176 percent on December 19.
(Reporting by Leigh Thomas; Editing by John Stonestreet)
(This story was corrected in the second paragraph to change the amount issued to 8.715 billion euros)