Bonds: Spanish bonds rise on hopes for intervention

Date: Friday 22 Jun 2012

These were the yields and movements on some of the most watched 10-year bonds by the close in Europe:

Spain: 6.34% (-27bp)
Italy: 5.76% (+1bp)
France: 2.60% (-4bp)
Germany: 1.58% (+5bp)
UK: 1.73% (+3bp)
US: 1.67% (+5bp)

Spanish bonds rocketed in trading on Friday as investors bet European politicians would take concrete steps to salve the sovereign debt crisis.

Today the European Central Bank relaxed rules on the security banks must put down in exchange for ECB loans.

The German Chancellor Angela Merkel is in meetings in Rome today with leaders from France, Italy and Spain as speculation mounted Germany would allow more direct intervention in bond markets to support the under pressure nations.

A euro area summit is scheduled for June 28th and 29th, markets are expecting it to deliver more clarity on the rescue plan for Spain.

BS

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