US borrowing rates ease lightly despite credit downgrade
PARIS: US government bonds firmed slightly and borrowing rates eased on the sovereign debt market in Europe on Monday despite a decision by Standard & Poor's to downgrade the US' top "AAA" rating on Friday.
The yield, or borrowing rate, on US 10-year US bonds eased to 2.533 percent from 2.558 percent on Friday and the yield on 30-year bonds fell to 3.820 percent from 3.846 percent.
Short-term yields were steady at zero percent.
Analysts said that despite the unprecedented US ratings downgrade, investors really had no option but to continue holding US government bonds.
"The US bond market is the most liquid in the world. So European and Asian investors have no choice but to buy these instruments which remain a haven of safety in times of crisis," bond strategist Nordine Naam said at French investment bank Natixis.
Copyright AFP (Agence France-Presse), 2010
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