German, UK bonds rise on GDP update, Brexit vote

Tuesday, 15. January 2019 11:27

The rally in European stocks, set in motion on Tuesday against the backdrop of China's measures to stimulate the economy, faded toward the middle of the session. Investors favored benchmark sovereign bonds and the yen, another safe haven asset, though gold was still under moderate pressure, ahead of the vote in the Parliament of the United Kingdom about the Brexit deal that was reached with the European Union. Market participants became less prone to risk also after a statistical report that Germany's gross domestic product growth slowed to 1.5% last year from 2.2%.

The yield on the two-year note issued by the government in Berlin rose slightly, sending the yield lower to a negative 0.603% at 11:23 am CET. The ten-year Bund yielded 0.209% or 2.3 basis points less for the day, compared to the fall of 2.2 points to 0.814% for the 30-year bonds. Corresponding futures added 0.01%, 0.12% and 0.31%, respectively, in price.

The UK's two-year yield weakened half a point to 0.81%. The ten-year measure declined 1.9 points to 1.174% and the yield on the 30-year bonds dropped 1.7 points to 1.806%. The ten-year United States Treasuries yielded 2.689%, a decrease of 1.4 points.

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