Sponsored by Digital Look Events

Bonds round-up: Weak economic data boosts US bonds

News for Spread Betters

PreviousPrevious
NextNext

There's a new Investor Edition of CMC Markets' spread betting platform... and it's exclusive to DigitalLook.com users...

Get full details about Marketmaker:Investor Edition here. Advertisement

Date: Tuesday 25 Mar 2008

LONDON (ShareCast) - US treasuries moved higher on the back of disappointing US consumer confidence data but European and British government bonds fell back as equities held sway.

The Conference Board’s index of US consumer confidence in March declined to a five-year nadir of 64.5 from February’s reading of 76.4. Economists had predicted a March index value of 73.5.

Further support for bonds came from the the S&P/Case-Shiller home-price index which showed US house prices are still in freefall. The January index fell 10.7% after easing 9% in December.

The yield on the 10-year note slipped 8 basis points lower to 3.48%. The gap between the yield on the 10-year note and the 2-year note expanded by just over a basis point, indicating investors’ preference for shorter dated debt ahead of an anticipated interest rate cut by the Federal Reserve Board next month.

In Britain and continental Europe government bonds fell back as investors turned their attention to equities, as European stock markets played catch-up with the US market which does not close for Easter Monday.

The yield on the 10-year bund rose 10 basis points to 3.87% while the yield on the 10-year gilt advanced 8 basis points to 4.37%.