Spain Lends Out €60 Billion Cash Pile in Bid for Higher Returns.

Spain plans to lend out its cash holdings of over €60 billion in order to increase returns. The country's Treasury will offer funds currently held by the local central bank in exchange for government securities as collateral. By lending out the cash, Spain aims to generate a higher return than the European Central Bank's overnight rate. This move takes advantage of increased demand for cash in European money markets, which has been driven by a surplus of high-quality bonds in the market. Germany, in particular, has seen a strong incentive to lend out cash since its central bank stopped paying interest on domestic government deposits. Spain's cash holdings are nearly double those of Germany, making it an attractive option for lending. [Extracted from the article]

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