Bloomberg News

German Bunds Advance Before European Investor-Confidence Report

August 06, 2012

German 10-year bonds rose, with yields falling from the highest in a month, before an industry report that economists said will show European investor confidence declined to the lowest level in three years.

Bunds snapped last week’s decline as European stocks dropped, boosting demand for the region’s safest assets. German government securities slid last week amid bets the European Central Bank will buy the bonds of nations such as Italy and Spain to help contain the debt crisis. The Netherlands and France will auction bills today.

The German 10-year bund yield fell two basis points, or 0.02 percentage point, to 1.40 percent at 8:07 a.m. London time after rising to 1.44 percent, the highest since July 5. The 1.75 percent bund due in July 2022 gained 0.21, or 2.10 euros per 1,000-euro ($1,236) face amount, to 103.20.

Germany’s Sentix research institute will say its index of sentiment in the euro-area economy declined to minus 31 in August, the lowest since July 2009, according to a Bloomberg News survey of economists.

German debt returned 3.3 percent this year through Aug. 3, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. Spanish securities fell 4.3 percent, and Italy’s debt rose 8.5 percent.

To contact the reporters on this story: Lucy Meakin in London at lmeakin1@bloomberg.net; Emma Charlton in London at echarlton1@bloomberg.net.

To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net.


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