Bonds round up: Strong week for US bonds

Date: Friday 15 Jan 2010

US Treasury bonds are having another strong day thanks to positive inflation news. Ten-year bonds are on track for their biggest weekly gain since November.

Inflation does not appear to be a worry at the moment. US consumer prices rose 2.7% in 2009, a sharp increase from 2008, though the monthly rise only came to 0.1% last month after a 0.4% increase in November.

Ten-year yields dropped eight basis points to 3.66%. Two-year yields were six basis points lower at 0.86%.

UK gilts were also on the rise. Two-year yields fell one basis point to 1.22%, while ten-year yields were five basis points lower at 3.94%.

German bunds were higher even though eurozone consumer price inflation rose. Two-year yields were five basis points lower at 1.13% and ten-year yields were three basis points lower at 3.26%.

Consumer prices in the 16-nation eurozone rose 0.9% year-on-year in December, the European Union's statistics office confirmed. The rate, which compares to a 0.5% gain in November, was in line with Eurostat's previous estimate.

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