This morning, BBH’s Marc Chandler noted:
In today’s European trading session, Ireland sold €100 of bills with an average yield of 2.23% with a maturity set for April 18, 2011. On the whole, Ireland auctioned €400M of bills, less than the maximum sought by the debt agency. On the back of this news and weak manufacturing data, Irish 10 year yields spiked to a record high relative to the German benchmark. As a result, this protracted selling of the periphery’s debt led to a sharp increase in the price of protection (CDS). On the supply side Germans bunds rose and its yield discount to the periphery rose after the nation said it will sell less debt than previously estimated.
Here is a chart showing you that, indeed, Ireland is now near the centre of the sovereign debt crisis in Europe with a debt default probability of 35%.
Greece still leads the way in the Eurozone with a 51% default probability, second on the list just behind Venezuela.
The biggest cause for concern in Ireland today was the horrible GDP report in which gross domestic product (GDP) fell 1.2%. The statisticians also revised down Q1 growth from 2.7% to 2.2%.