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15 Jan 2015
German 10-yr yield hit record low
FXStreet (mumbai) - The German 10-year Bund yield fell to a record low of 0.402%, after the Swiss National Bank’s (SNB) decision to abandon the cap on EUR/CHF led to a sharp decline in the EUR/USD pair.
The yield currently trades two basis points lower at 0.412%. Moreover, markets saw the SNB’s decision to end the cap and cut interest rates to -0.75% as an indication that the European central Bank (ECB) is likely to announce a QE program bigger than the expected size of 500 billion Euros. Consequently, the long duration yields were pushed lower across most of the advanced nations, with German 10-yr yields hitting record lows.
Given that market considers sovereign QE as a done deal, yields may continue to fall ahead of the next week’s ECB meet as market price-in a bigger QE program than anticipated earlier.
The yield currently trades two basis points lower at 0.412%. Moreover, markets saw the SNB’s decision to end the cap and cut interest rates to -0.75% as an indication that the European central Bank (ECB) is likely to announce a QE program bigger than the expected size of 500 billion Euros. Consequently, the long duration yields were pushed lower across most of the advanced nations, with German 10-yr yields hitting record lows.
Given that market considers sovereign QE as a done deal, yields may continue to fall ahead of the next week’s ECB meet as market price-in a bigger QE program than anticipated earlier.