The oversupply of government bonds in the primary market pushes their prices downwards, resulting in higher borrowing costs for the euro area Member States.
The phenomenon was intense today, as Germany, Italy, the Netherlands and primarily the E (E to finance the Recovery Fund) proceeded to issue bonds. According to information, the EU alone, is said to have raised about 85 billion euros from the markets.
In fact, in Germany, where demand was lower than expected, bond yields on the secondary market rose.
Inflation in the US was a “counterweight” to the pressures, as the relevant index slowed to 0.3% in August, from 0.5% “running” last month. This development has raised expectations for deflationary pressures on both sides of the Atlantic.
It is recalled that the ECB has also characterized the rise in inflation in the euro area as temporary
In the domestic secondary market, bond yields did not fluctuate significantly compared to yesterday. Thus, the yield of the 5-year-old ranged at -0.033% from -0.031%, that of the 10-year-old moved to 0.75% and that of the 15-year-old to 0.84% from 0.86%.
In the Electronic Transaction System of the Bank of Greece (HDAT) transactions of 194 million euros were recorded, of which 78 million euros related to purchase orders. The yield on the 10-year benchmark bond stood at 0.77% from 0.78%, compared to -0.35% of the corresponding German bond, resulting in a margin of 1.12% from 1.11%.
In the foreign exchange market, the euro strengthened slightly, as the euro / dollar exchange rate fluctuated, in the early afternoon, at 1.1820 dollars, from the level of 1.1808 dollars that the market opened.
The indicative price for the euro / dollar exchange rate announced by the European Central Bank was $ 1.1814.
Source: ΑΠΕ – ΜΠΕ.
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