Gov’t bond yields down amid BoJ surprise

Government bond yields were down earlier today as investors reacted to recent inflation data in the eurozone as well as the surprise move by the Bank of Japan to introduce a negative interest rate on deposits.

Data from Tradeweb point to bid yields falling further into negative territory on a number of securities issued by Germany, France, Italy and Japan.

  • The German 2-year bond bid-yield fell to -0.477% at 9:32am UK time.
  • The German 5-year bond bid-yield fell to -0.297% at 11:20am UK time.
  • The French 2-year bond  bid-yield fell to -0.397% at 10:38am UK time.
  • The French 5-year bond  bid-yield fell to -0.121% at 11:26am UK time.
  • The Japanese 2-year bond bid-yield fell to -0.079% at 9:17am UK time.
  • The Japanese 5-year bond bid-yield fell to -0.066% at 4:35am UK time.
  • The Japanese 10-year bond bid-yield fell to 0.102% at 9:37am UK time.
  • The Italian 2-year bond fell below 0%, touching -0.004% at 8:26am UK time.

According to Eurostat figures, inflation in the eurozone rose to an annualised rate of 0.4% in January from 0.2% in December. This rate is still significantly lagging the European Central Bank’s medium term inflation target of 2%, and the moves on yields suggests that investors may be concerned that growth in Europe is still too slow to expect interest rates to start moving up anytime soon.


Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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