TOKYO: US Treasuries dropped on Monday on relief as Cyprus clinched a last-ditch deal with international lenders for a 10 billion euro ($13 billion) bailout hours before a deadline to avert a financial collapse on the Mediterranean country.
The yield on the 10-year notes rose to 1.963 percent from 1.927 percent at the end of last week while US share futures gained about 0.4 percent.
The latest deal on Cyprus included drastic measures such as closing down the country's second largest bank and freezing deposits above 100,000 euros, causing a far larger hit on large account holders than a botched bank levy plan would have done.
Still, investors took the news as positive for risk sentiment, as they judged that risk of contagion to other euro zone countries will be limited after Cyprus has avoided a chaotic exit from the euro zone.
"I think the market will put Cyprus behind it from now. It is a small country, so the impact will be limited," said a trader at a Japanese bank.
German Finance Minister Wolfgang Schaeuble also said the measures do not need an approval by the Cypriot parliament as necessary legislation has been already passed.
Comments
Comments are closed for this article.