Azernews.Az

By Bloomberg

Euro-area government bonds slid, with benchmark German 10-year bunds declining for the 10th time in 11 days, as a selloff in global fixed-income markets deepened before debt sales this week.

The decline in the price of the region’s sovereign securities came after U.S. Treasury 10-year yields jumped 13 basis points on Monday, the biggest increase since Feb. 6. The Netherlands is set to auction as much as 3 billion euros ($3.4 billion) of 10-year bonds on Tuesday, while Germany plans to sell 1 billion euros of index-linked debt. Italy is scheduled to offer as much as 7 billion euros of securities on Wednesday.

“What’s new in this is that now it seems to be the U.S. side of things driving things lower,” said Christoph Rieger, the Frankfurt-based head of fixed-income strategy at Commerzbank AG. “With the supply that is coming up, which is certainly a factor, the market still may be tempted to test the lows. Now is not the time to be bold.”

German 10-year bund yields climbed five basis points, or 0.05 percentage point, to 0.66 percent at 8:19 a.m. London time after increasing six basis points on Monday. The yield has surged from a record-low 0.049 percent as recently as April 17. The 0.5 percent security due in February 2025 dropped 0.505, or 5.05 euros per 1,000-euro face amount, to 98.455.

Italy’s 10-year bond yield increased seven basis points to 1.84 percent, while Spain’s jumped eight basis points to 1.83 percent.