German bonds advanced for a second day as a slowdown in Japanese economic growth added to signs the global economy is weakening, underpinning demand for the safest government debt.
The German two-year note yield was within two basis points of an all-time low before the nation, along with Italy and France, sells more than 19 billion euros ($23 billion) of bills. Japan’s gross domestic product advanced an annualized 1.4 percent in the three months through June, less than the median estimate of 2.3 percent in a Bloomberg News survey of economists and down from 5.5 percent the previous quarter. Spanish and Italian two-year notes slumped for a fifth day
Germany’s 10-year bund yield fell two basis points to 1.37 percent at 9 a.m. London time, after dropping four basis points last week. The 1.75 percent bond due July 2022 rose 0.145, or 1.45 euros per 1,000-euro face amount, to 103.490.
Spanish two-year note yields rose five basis points to 4.24 percent, while the rate on similar-maturity Italian debt gained four basis points to 3.44 percent.