NEW! Investment Companies Centre

Bonds round-up: Bonds fall as interest rate rises loom

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: Monday 30 Jun 2008

LONDON (ShareCast) - European bonds fell sharply as euro zone inflation hit record highs this month, stoking expectations the European Central Bank (ECB) will raise interest rates Thursday.

The harmonised index of consumer prices (HICP) rose 4% from the same month last year in June, compared with a year-on-year rise of 3.7% in May, making the ECB more likely to raise rates.

The yield on the benchmark 10-year German bund rose by 10 basis points to 4.64%.

UK gilts followed European bonds lower. The Bank of England may increase rates in concert with the ECB, with inflationary fears still strong despite weak economic data, such as news today that lending activity fell at UK building societies.

The yield on 10-year gilts rose 10 basis points to 5.12%.

US bonds also fell back with record high oil prices stoking inflationary fears.

The yield on a 10-year US treasury bill climbed two basis points to 3.98%.

Digital Look have been voted
"Best Research and Information Provider"

4th Floor, Bankside House, 107 Leadenhall Street, London EC3A 4AF.
Registered in England and Wales (registered no. 3678570).