PARIS: The yield on 10-year German and French bonds hit a new record low on Friday with investors still seeking refuge in safe-haven assets amid problems in Spain.
At around 0800 GMT the rate of return for investors on 10-year German Bunds on the secondary bond market fell to 1.158 percent, and the yield on French 10-year bonds fell to 2.278 percent, beating records set a day earlier.
A little later, the German yield has risen back to 1.165 percent, from 1.199 percent at close on Thursday while the French yield was at 2.280 from 2.348 percent on Thursday.
Spain's yield meanwhile rose to 6.589 percent from 6.536 percent at the close on Thursday, bringing the spread between German and Spanish borrowing rates to 5.45 percentage points.
The eurozone bond market is under heavy pressure stemming from concern about public finances and the banking system in Spain.
For a eurozone country such as Spain, an interest rate above 6.0 percent is considered dangerous territory with respect to its ability to refinance public debt.
Countries that had to pay 7.0 percent or more, including Greece, Ireland and Portugal, were forced to negotiate international bailouts.
Comments
Comments are closed.