Euro zone bond yields fall as investors seek safe havens
TLT•Euro zone bond yields fell on Tuesday alongside U.S. Treasury yields as a tech-stock selloff prompted flows into government debt. Germany’s 10-year yield was down 1 basis point at 3.46%, while France’s fell 6 basis points to 4.84%.
1. Yields decline
Germany’s 10-year yield, the euro zone benchmark, fell 1 basis point to 3.46%, while its two-year yield was roughly unchanged at 3.125%. The U.S. 10-year Treasury yield fell 3 basis points to 5.22%; France’s 10-year yield dropped 6 basis points to 4.84%, and Italy’s fell 3 basis points to 4.55%.
2. Market concerns
Renewed jitters in technology stocks helped drive safe-haven flows into bonds. Germany’s 10-year yield had reached 3.65% in late September and early October, its highest since 2009. The spread between French and German debt stood at 138 basis points, below early October’s nearly 160-basis-point high; Italy issued €7 billion across three bonds, which drew good demand, while a German bond auction saw weak demand.
