Yields on German, US 10-year bonds falls to record low

PARIS: The cost of borrowing for Germany and the United States for 10 years fell to historic low points on Monday, as fu

The yield or interest rate indicated by the price of German 10-year bonds fell to 1.709 percent from 1.770 percent at the close of trading on Friday, and the yield on 10-year US treasury bonds was at 1.877 percent from 1.918 percent.

The renewed tension over concern that Greece may not be able to meet the terms of its two rescue programmes, is part of new strains over debt issued by other eurozone countries considered to face serious problems in correcting their public finances.

The European central Bank has been buying on the secondary market bonds issued by these countries, as well as providing day-to-day cash to banks on easy terms.

At ING bank strategy and research, analyst Alessandro Giansanti commented: "Last week, the resignation of Juergen Starck from the ECB board, due to rumours of personal disappointment with the ECB purchasing of Italian and Spanish bonds, has sparked another round of heavy widening in (eurozone) peripheral (yield) spreads."

Copyright AFP (Agence France-Presse), 2011

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