Treasuries rose for a second day after Bild newspaper reported Germany is preparing for a Greek default, sparking demand for the safest assets.
“This news will be very supportive to U.S. Treasuries,” said Hajime Nagata, who invests in bonds for Tokyo-based Diam Co. “It’s difficult to imagine what’s going to happen” if Greece fails to pay its debts, he said.
U.S. 10-year yields dropped one basis point to 2.37 percent as of 6:08 a.m. in London, according to Bloomberg Bond Trader data. The price of the 2.125 percent note due in May 2025 rose 3/32, or 94 cents per $1,000 face amount, to 97 7/8.
Germany is considering capital controls for Greece in the event of a default, Bild reported, citing unidentified people familiar with the plans.