Strong demand for bonds of EU bailout fund

(FRANKFURT) - The EU's bailout fund, the EFSF, said it attracted strong demand on Tuesday in its first auction of seven-year debt, with strong demand from Asia, central banks and sovereign wealth funds.

The bonds were sold at a rate of 2.654 percent, the European Financial Stability Facility said in a statement.

The EFSF borrows money from the markets at low rates and lends it to countries having difficulty in raising their own financing, such as Greece, Ireland and Portugal.

In addition to its short and medium-term debt auctions, the EFSF also borrows funds long term and last month it successfully placed 1.5 billion euros in 20-year bonds at a yield of 3.956 percent.