Last Thursday Spain sold 10-year bonds at 3.06%, the lowest yield since 2005 and near an all time record

Livewire News


Last Thursday Spain sold 10-year bonds at 3.06%, the lowest yield since 2005 and near an all time record. The average yield to maturity on Greek, Irish, Italian, Portuguese and Spanish debt has now fallen to 2.19%, the lowest since 1998. Interestingly, Spanish 10year bonds have averaged twice this level since 1991 yet today the countries debt to GDP continues to worsen (it was 93.9% in Q4). Obviously, the central bank backstop is the driving force, but the market seems to be pricing in something even more extreme. In essence, it looks like European debt of all types is once again becoming indistinguishable to a large degree. This sort of convergence implies that there is a greater chance of a supranational entity in Europe's future. Which makes the incomplete monetary union reflect something more like the USA where there is a unified Treasury, Central Bank and currency system. (VIEW LINK)

3 topics

Livewire News
Livewire News

Livewire News brings you a wide range of financial insights with a focus on Global Macro, Fixed Income, Currencies and Commodities.


No areas of expertise

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.


Sign In or Join Free to comment