Upgrade Now

Bonds round up: Mixed day for US bonds

Date: Friday 22 Jan 2010

Bonds round up: Mixed day for US bonds

US Treasuries don’t seem to know which way to go as the US market digests yesterday's bank regulation announcement by President Barack Obama.

Two-year bonds are flat and the yield has dipped by nearly one basis point to 0.82%.

Longer-dated bonds have fallen slightly. The ten-year yield rose by three basis points to 3.62%, although it is not far off the low for the past month.

UK gilts are more consistent with falls across the board after disappointing retail sales figures. Two-year yields are three basis points higher at 1.26%, while ten-year yields were hardly changed at 3.93%.

Retail sales volumes rose by much less than expected in December, as price rises kept the UK consumer away from the shops over the Christmas period. Sales were up by 0.3% from November, figures from the Office of National Statistics show. Analysts had been expecting a 1.1% rise in sales.

Year-on-year sales were up by 2.1% in December, short of the 3% rise that had been expected. The figures demonstrate that, while volumes were weak, values were relatively strong. Retailers raised prices by 1.2% from the same month the previous year in December, hoping to capitalise on improved consumer sentiment.

Car production in Britain plunged by 31% in 2009. The Society of Motor Manufacturers (SMMT) warns that carmakers will have a tough 2010 as the government’s scrappage scheme draws to an end. About £125m was left last month.

German bunds were rising at the shorter-dated and longest-dated ends. Medium-to-long-term bunds have fallen slightly. That means that two-year yields are one basis point lower at 1.11%, while ten-year yields are one basis point higher at 3.22%.

European industrial orders in November were stronger than expected. In the 16 country euro area, industrial orders were 1.6% ahead of the October level. Orders are still 1.5% lower over the past 12 months.

« Go back to news channel

Email this article to a friend

or share it with one of these popular networks:


Top of Page