Investors continue to demand higher interest on Greek government bonds as fears grow that Greece could default on its debt obligations. The spread between Greek government bonds and German government bonds, which have the lowest rate in the Eurozone, widens with every bond offering.
While the increase in the bond spreads has made it more difficult for Greece to borrow money, so far, the government has managed to acquire the funds it needs to meet operational costs. Analysts suggest however, that the higher costs will add to Greece’s difficulties and this will lead to a further deterioration of Greece’s finances.
Source: BBC News
