Friday, 29 June 2007

European Government Bonds Set for Biggest Quarterly Drop in Almost 8 Years

(Bloomberg) -- European government bonds are set for
their steepest quarterly decline in almost eight years as signs
of quickening economic growth and inflation underpin the case for
further interest-rate increases by the European Central Bank.

German bunds, Europe's benchmark, dropped for a fourth
month, with 10-year yields touching a five-year high, as the ECB
raised its lending rate to a six-year high and indicated further
increases are needed to curb inflation. ECB President Jean-Claude
Trichet has said borrowing costs are low enough to stimulate
expansion in the $10.4 trillion economy.


Read more at Bloomberg Bonds News

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