June 22 (Bloomberg) -- German government bonds fell as Greek Prime Minister George Papandreou won a confidence vote, paving the way for the country to implement austerity measures needed to receive aid, damping demand for the safest assets.
The losses pushed the 10-year bund yield up to the highest in a week. Papandreou reshuffled his cabinet and sought the approval of parliament after fending off a revolt within his socialist Pasok party last week. Germany is scheduled to sell 4 billion euros ($5.8 billion) of 10-year bonds today. The MSCI Asia Pacific Index rose for a second day, gaining 1 percent. Futures on the Euro Stoxx 50 were little changed.
The 10-year bund yield was little changed at 2.99 percent as of 7:40 a.m. in London. It reached 2.91 percent on June 16, the lowest level since Jan. 11. The 3.25 percent security due July 2021 fell 0.120, or 1.20 euros per 1,000-euro face amount, to 102.18. Yields on two-year notes gained one basis point to 1.54 percent after reaching 1.53 percent. They dropped to 1.43 percent last week, the least since Feb. 22.
German government bonds have returned 0.2 percent this year, according to indexes compiled by the European Federation of Financial Analysts Societies and Bloomberg, while Treasuries gained 3.2 percent. Greek securities lost 19 percent, the indexes show.
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