Strong demand for California’s latest debt sale has pushed down anticipated yields in a sign that credit markets may be bouncing back from the financial crisis.
The state on Monday begins the sale of $8.8bn in short-term notes, less than three weeks after it stopped issuing IOUs to pay its bills amid a budget crisis. Originally expected to yield 2-3 per cent, the notes might now pay as little as 1.25 per cent for a tranche due in May and 1.5 per cent for another due in June.
