German bonds rose for the first time in five days as the European Central Bank was said to be a preparing a package of broad-based asset purchases.
Spanish and Italian securities also advanced after two central bank officials said yesterday the proposal, known as quantitative easing, was envisaged to include various types of bonds and not encompass equities. Euro-area government securities declined yesterday after ECB President Mario Draghi said that the central bank will wait until next quarter before assessing whether easing measures are required to boost inflation.
Germany’s 10-year yield fell two basis points, or 0.02 percentage point, to 0.75 percent as of 7:22 a.m. London time. The 1 percent bund due in August 2024 rose 0.225, or 2.25 euros per 1,000-euro ($1,238) face amount, to 102.33. The rate increased seven basis points over the previous four days, after dropping to a record 0.69 percent on Dec. 1.
The yield on Italian 10-year debt declined three basis points to 2.01 percent and that on similar-maturity Spanish bonds slid three basis points to 1.86 percent.
German government securities returned 8.6 percent this year through yesterday, Bloomberg World Bond Indexes show. Spain’s earned 15 percent and Italy’s 14 percent.
