With interest rates remaining favorable, Mayor Scott Avedisian announced yesterday he hopes to save the city about $1 million in interest costs on $27 million of bonded debt over the next 10 years.

“We were looking at old debt and where we could save,” Avedisian said yesterday.

As there are costs associated with refinancing general obligation bonds, the mayor explained it doesn’t always make sense to refinance, although there may be a spread between the two rates.

In this case, however, the difference is great enough to generate substantial savings.

“As of Monday we were in excess of $1 million,” Avedisian said.

There’s no saying at this time exactly what the savings would be because the refinancing must first be approved by the City Council and rates could change again by the time the financing package is finalized.

There could be an added unintended benefit to the action.

Avedisian acknowledged that bond rating agencies would look at the city. He said he is hopeful Moody’s would remove the “negative” outlook placed on Warwick bonds.

The city is carrying a total of $51 million in bond debt exclusive of recent school bonds for fire code and other improvements, which the School Committee agreed to assume.