Spain's horrible debt auction and France's medium-term treasury notes

Spain had a horrible debt auction selling €3.56 billion of a new 10-year bond at an average yield of 6.975 % ,missing  the maximum target of €4 billion. Spanish yields are now at the highest since the start of the euro. Meanwhile, Spanish finance minister Elena Salgado cut GDP forecast saying the economy will grow 0.8% this year, against the 1.3% government target.

France sold €6.98 billion of medium-term treasury notes, also called BTANs, above its projected range, but with borrowing costs jumping. The BTAN maturing September 2013 had an average yield of 1.85%, above 1.31% a month ago, while the note maturing in July 2015, had an average yield of 2.44%, up from 1.96%. Meanwhile, France is at risk of losing its AAA rating and the country continues to spar with Germany over the ECB's role in Europe's debt crisis.