Italian and Spanish government bonds fell as Greece struggled to reach accords with European officials and its creditors to avoid a default next month, sapping demand for the region’s higher-yielding assets.
German bonds fell, posting a weekly decline, as U.S. employment climbed more than economists forecast in January and the jobless rate slipped to the lowest in three years. Italian 10-year yields rose from the least since October after a report showed the country’s services sector contracted more than estimated. The French-German 10-year yield difference dropped below 100 basis points for the first time in almost two months.
“There’s an element of caution out here with regards to Greece,” said Marc Ostwald, a fixed-income strategist at Monument Securities Ltd. in London. “The Italian data was very poor and the underlying picture is that the non-core economies are in a pretty dire state.”
This Bloomberg story was filed from London yesterday...and is Roy Stephens first offering of the day. The link is here.
