UK, German yields bounce off all-time lows

Thursday, 15. August 2019 09:58

As relative calm set in at stock exchanges throughout Europe, helped by the Assumption Day holiday, investors reversed a small part of the recent buying wave in markets for sovereign debt. In a cautious retreat of risk aversion, prices of mid-term and long-term state bonds of Germany and the United Kingdom slipped, taking yields away from the initial lows. The measures of borrowing costs touched new negative records today in early trade.

The British yield curve remained inverted at the most widely watched section after the two-year yields yesterday topped those for ten-year maturity for the first time since the financial crisis 11 years ago. Gold and silver also slipped but the shift of focus away from safe havens may be short-lived amid chronic pains regarding interest rates, trade disputes, the global economic slowdown and Brexit.

The German two-year yield was 1.2 basis points lower at 0.881% below zero at 9:50 am CET, just above the all-time low. The ten-year rate was marginally higher at a negative 0.647% following a dip to 0.661%. The thirty-year yield was flat at minus 0.191%. Today it hit 0.211% under zero. Corresponding futures were flat and down by 0.12% and 0.22%, respectively. The UK's two-year yield jumped 1.5 points to 0.474%. The other two benchmarks were little changed at 0.455% and 1.053% after dropping to 0.447% and 1.042%, respectively.

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