MGA - Policy Insights
17 Apr 15
Girl Interrupted It has been a typical post-Easter holiday week but the trends in place since January have held intact. Th e downward pressure on core European yields has been relentless over the week with 10- and 30-year Bunds falling to all time lows below 10 bp and 50 bp respectively. Indeed yields on the German curve out to the eight- to nineyear area are now in negative territory. While US Treasuries have also been caught up in the rally, helped by weaker data, they are lagging their European counterparts. Th e latter are being boosted both by increased risk that Greece could default on its repayments to the IMF in May and reassurance from Mario Draghi at his ("girl interrupted") press conference that the recentpick up in the Eurozone’s economic outlook does not translate into an early termination of the quantitative easing program.