Insider Economy Greek govt bond yields hit six-month lows after bond sale

Greek govt bond yields hit six-month lows after bond sale

Greek bond yields dropped sharply on Wednesday, set for a fifth straight day of falls, following a successful five-year bond sale — Greece’s first since exiting its bailout last year.

Greece’s 10-year government bond yield fell more than six basis points to a low of 3.915 percent, its lowest level since August 1, while Greece’s five-year government bond yield was last down three basis points to a six-month low of 2.928 percent .

A vote by Greek parliament last week cleared a path for Greece’s northern neighbour Macedonia, under its new name, to join NATO, and paved the way for a Greek five-year a bond sale.

The bond issue, yielding 3.6 percent and the country’s first since its third international rescue package ended in August, attracted investor orders worth four times the issue’s size, government officials said on Tuesday.

“In terms of rational, right now, when you adjust spreads by volatility, Greece offers a chunky pick up versus Bunds,” Jamie Costero, bond strategist at BBVA, said.

He said when you looked at the volatility-adjusted spread of Greece this was double that of Spain and more than double of Italy.

Greek 10-year government bonds offer a spread of 369 basis points over the 10-year German Bund, seen as the risk-free benchmark for the region, versus 104 basis points for Spain’s 10-year bond spread.,


Elsewhere, broader euro zone bond yields held firm on Wednesday after British lawmakers voted down a proposal in parliament that aimed to prevent a potentially chaotic “no-deal” Brexit which markets appear reluctant to price in.

Core bloc bond investors paused for breath following the vote, and ahead of key euro zone data, the U.S. Federal Reserve press conference, and the resumption of trade talks between China and the U.S., all due later on Wednesday.

British lawmakers on Tuesday instructed Prime Minister Theresa May to reopen a Brexit treaty with the European Union to replace a controversial Irish border arrangement – and promptly received a flat rejection from Brussels.

At the same time, parliament rejected a proposal to stop a potentially chaotic “no-deal” exit by making May ask Brussels for a delay if she cannot get a deal past lawmakers.


The euro zone bond market has grown a little immune to Brexit noise, Christoph Rieger, rates strategist at Commerzbank, said.

“Given the UK amendments and what (European Council President Donald) Tusk said, this combination increases the risk of a disorderly Brexit. The market is reluctant to price this scenario,” Rieger said. “The market still maintains its faith that reason will prevail. This morning, it looks quite a fantasy to come up with such a scenario.”

Investors bought German Bunds in the run-up to Tuesday’s vote. German 10-year Bund yields were last trading at 0.192 percent, close to levels traded late on Tuesday.

British 10-year government bond yields fell 1.4 basis points to 1.255 percent in early trade.

Euro zone bond yields were largely unchanged, , even though Goldman Sachs and others, saw the chance of a no-deal Brexit increasing.


Top Stories

188 new cases of COVID-19 on Thursday

The Health Ministry announced 127 new COVID-19 cases on 22 October, out of 4,304 laboratory tests, taking confirmed infections to 3,154.   The break-down of new...

Confirmed COVID-19 cases in Ygia Polyclinic

Ygia polyclinic is informing the public that due to the fact that a small number of COVID-19 cases have been found among the staff...

President Anastasiades will not resign

President Nicos Anastasiades will not betray the decision of the big majority of the citizens and will complete his term, as the Constitution and...

Citizens request the resignations of those involved in illegal passports’ case

In an announcement, organized groups of people are requesting the immediate resignation of politicians directly or indirectly involved in the issuing of Cypriot passports...

New measures announced by Health Minister due to increase in number of COVID-19 cases

Face masks must be worn outside at all times, the Cabinet decided on Thursday. Moreover, stricter measures apply in all districts and partial lockdown...


Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...


No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...