Greece to Sell Nearly $7 Billion in Bonds

Greece is looking to issue as much as 5 billion euro ($6.7 billion) in seven-year bonds. The announcement Monday came just days after the European Union and International Monetary Fund arrived at an agreement on how to backstop the country's finances as it works its way out of crippling debt.

The bond sale is likely to be the first of many to get the Greek government through its funding needs in April and May, according to a report by Bloomberg. Greece needs to refinance about 20 billion euro ($26.8 billion) over the next two months and is expected to borrow roughly 54 billion euro, or $72 billion, this year. Greece's budget deficit for 2009 came in at more than 12%, or four times over the eurozone limit.

Still, Greece's wobbly finances mean its borrowing costs remain high. The syndicated bond offering will likely be priced more than three percentage points over the relevant benchmark, Bloomberg reported, which translates to roughly twice the borrowing costs of Germany. The nation needs to raise another 10 billion euro ($13.4 billion) in May.

Last last week the eurozone countries and the IMF agreed on a plan to rescue Greece if the country found itself unable to borrow money in the capital markets or make its debt payments. The move soothed investors and caused the euro to rebound against the dollar following a slide to 10-month lows.

Still, while much has been made of the economic difficulties facing the eurozone -- countries with vastly different markets have been put under one roof, after all -- the accompanying internal political frictions in resolving this major shortcoming have also been on full display.

Last week Fitch Ratings cut Portugal's sovereign debt rating a notch to AA- and warned of further possible downgrades if the country doesn't drastically curtail its own mounting budget deficits. Both Portugal and Greece are among the so-called PIIGS of Europe, shorthand for the nations of Portugal, Ireland, Italy, Greece and Spain, all of which are struggling with mounting fiscal woes.