Belgium's borrowing rates rise sharply in latest auction; 10-year issue's yield grew to 5.66% from 4.37% in similar auction last month

BRUSSELS , November 28, 2011 () – Belgium has had to pay sharply higher interest rates to borrow money in the markets, in another sign that the country's political instability has ratcheted up concerns over its ability to deal with its debts.

Though Belgium easily raised euro2 billion ($2.67 billion) in a variety of auctions Monday, the rates rose sharply. For the ten-year issue, for example, the yield spiked to 5.66 percent as against 4.37 percent in the equivalent auction last month.

Monday's auction followed a credit downgrade of Belgium by Standard & Poor's last week.

Belgian authorities said it was important to show that it could raise as much as it sought on the market, even though rates were high.

Over the weekend, the coalition negotiators finally agreed on a 2012 budget.

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