France raises 7.8 bn euros at record low rates

France raised 7.84 billion euros ($9.8 billion) on Thursday, paying record rates to raise long-term debt as investors seek safe haven investments in the eurozone debt crisis. The French treasury had intended to raise 7-8.0 billion euros, with demand double what was on offer, and the interest rate paid to investors eased for all bonds available in the sale. Borrowing rates on benchmark 10-year debt fell to 2.46 percent, a historic low during an auction, from 2.96 percent on May 3. Borrowing rates also hit record lows of 2.90 percent for 15-year bonds and 3.27 percent for 50-year bonds. Last week France saw the yield on its 10-year bonds on the secondary market fall to a historic low of under 2.1 percent as concern flared over teetering Spanish banks. The return for investors on French 10-year bonds on the secondary market rose later Thursday to 2.530 percent from 2.398 percent on Wednesday. Moments before the French auction, Spain\'s borrowing costs soared as Madrid sold more than two billion euros in bonds as concerns mount Madrid may need to seek an EU rescue to save its bank. Spain raised 2.074 billion euros in the sale, beating its own target range of 1.0-2.0 billion euros and proving it can still access the market albeit at a high cost. Financial markets have been rattled by the state of Spain\'s finances, with Madrid appearing to need help to find 80 billion euros ($100 billion) for bank recapitalisations in the midst of a deep recession brought on by the bursting of a property bubble.