Flight From Government Debt Accelerates as Greece Fuels Meltdown
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The exodus from sovereign-debt markets is accelerating as investors question the sustainability of central-bank-engineered rallies that had pushed yields to record lows.
Greece’s government bonds tumbled on concern the country’s talks with creditors will fail to clinch a funding deal in time to prevent a default. The decline dragged Spanish and Italian counterparts lower. While previous instances of turmoil in Greece boosted the refuge appeal of German bunds, their prices fell as well. That weighed down U.S. government debt, which has been supported for much of this year by higher relative yields after the European Central Bank introduced quantitative easing.