German bonds move up, UK's debt prices surge

Monday, 21. January 2019 15:54

Prices of sovereign debt issued by the government in Berlin pared most of the gains on Monday and held only slightly higher late in the session. Traders in European bonds were focused on the plan by the United Kingdom's Prime Minister Theresa May to amend the Brexit proposal in order to secure a majority in Parliament. Unconfirmed reports indicated she intends to push the European Union to accept an expiration date, the so-called sunset clause, for the Northern Ireland backstop solution. The country's bonds rallied, pushing yields down, as stocks in London were insignificantly in the red.

In other news, Ireland rejected the possibility to engage in bilateral talks with Britain. Of note, statistics showed China's economic growth was lowered last year to 6.6%, the weakest level since 1990.

The German two-year note yield was marginally lower at a negative 0.578% at 3:47 pm CET, after falling to 0.587% below zero. The ten-year measure decreased to 0.262% and the yield on the 30-year bonds was down at 0.869%, compared to the session low of 0.85%. Comparable futures prices added 0.01% and 0.04% and declined 0.06%, respectively. British two-year notes yielded 0.785% or 2.4 basis points less for the day. The gauge of the 10-year gilt dropped by a staggering 4.1 points to 1.203% and the 30-year yield sunk 3.4 points to 1.831%.

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