"Treasury debt auctions mark a milestone in the Spanish economy 2025"

This week marks a significant moment for the Spanish economy, as the Public Treasury will begin the debt auctions for the year 2025. According to the official Treasury calendar, the auction of three- and nine-month Treasury bills will take place on January 14, followed by the issuance of bonds and state obligations on January 16. These auctions are a key tool for financing the country and are expected to attract the attention of numerous national and international investors. The close of 2024 left a stable outlook for debt issuance. The last auction of 2024, held on December 10, resulted in the sale of 2.582 billion euros in three- and nine-month Treasury bills. During that auction, the Treasury managed to reduce interest rates, reaching levels not seen in two years, which suggests effective debt management and a favorable environment for resource mobilization. According to the Ministry of Economy, Trade, and Business, the Public Treasury closed the year 2024 with a net debt issuance of 55 billion euros, representing a decrease of 10 billion compared to the previous year, when it reached 65.126 billion. This decline is attributed to the robust growth of the Spanish economy and the Government's commitment to fiscal responsibility, a factor that generates confidence in both the domestic and international markets. The gross debt issuance figure amounts to 259.341 billion euros, a moderate increase from 251.995 billion the previous year. This trend aligns with the Government's commitment to reducing the deficit and the debt-to-GDP ratio, which is expected to drop to 102.5% in 2024 from the 105.1% recorded in 2023. This decrease in the debt ratio is a positive indicator suggesting an improving trajectory in the country's financial stability. One of the highlighted aspects is the average duration of the debt, which remains close to eight years. This figure is crucial as it helps contain and stabilize the interest burden on GDP in the years to come, thereby reinforcing the sustainability of Spanish public debt. This strategy is essential to ensure that the country not only meets its financing needs but does so efficiently and responsibly. The average cost of outstanding debt was set at 2.21%, a slight increase of just twelve basis points compared to the end of 2023. Meanwhile, the average cost of issued debt continues to decline, standing at 3.16%, which implies a reduction of 28 basis points compared to the previous year. These figures are encouraging and reflect an interest rate environment that remains favorable for public borrowing. An aspect that should not be overlooked is the growing participation of international investors in the purchase of bonds and obligations. In 2024, they acquired 43.6% of the issued securities, marking an increase of 2.2 percentage points compared to 2023. This indicates renewed interest and confidence in the Spanish economy, which has led international investors to increase their holdings by more than 134 billion euros over the past two years. The financial situation of the country, with a focus on reducing the deficit and prudent debt management, positions Spain competitively in global markets. The expectation is that this week's debt auctions will generate significant interest, allowing the Government not only to finance its needs but also to do so at sustainable costs. Looking to the future, the Treasury's actions in this new round of auctions will serve as a thermometer for market confidence in the Spanish economy. The ability to attract both local and foreign investors will be essential to maintain stability and boost growth in an economic environment that continues to present challenges globally. Thus, the start of the 2025 auctions presents itself as a crucial chapter in the recent history of the Spanish economy, where fiscal prudence and efficient debt management are more indispensable than ever. The financial community will be closely watching the results, which could have significant repercussions for the country's economic policy as well as for the international perception of Spain as an investment destination.