Europe’s leaders argue that only deep budget cuts will revive the economy and inspire the necessary confidence among investors.

The deal represents a major milestone for Greece, which was effectively shut out of the markets in 2010 when the debt crisis left it dependent on international bailouts to stay afloat.The bond sale reflects increased optimism that Greece and other wobbly euro zone countries have turned a corner. In recent months, borrowing costs dropped significantly for Ireland, Portugal, Spain and Italy, as the investors deemed them less risky.

Unemployment in Greece rising at 27 percent. The bonds of both Portugal and Ireland have been in strong demand since those countries returned to the markets earlier

As a result, borrowing costs among the most troubled euro zone economies have been falling fast.fears are gone. The economy is stabilizing, with the International Monetary Fund recently raising its forecast for growth this year, to 0.6 percent. Greece has met a number of fiscal targets, and the government recently announced a primary surplus — a surplus before debt payments — of about €2.5 billion.

But Greece still has numerous economic hurdles to overcome, including a mountain of debt that will take decades to repay. Economists said Greece would need annual economic growth of nearly 5 percent over the next decade to make progress in paying off what it owes creditors. Greece also needs an export-driven recovery.

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