Euro-Area Bonds Seen Extending Rally as Data Slow to Trickle
- Spanish-German 10-year yield spread narrows for fourth week
- Traders sense calm as they wait one month for next ECB meeting
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No news may be good news for Europe’s higher-yielding government bonds.
The extra yield investors demand to hold Spanish 10-year securities instead of similar-maturity German debt has narrowed for four-straight weeks, the longest run in more than a year. The Italian-German spread is also tightening. And the rally may continue as a lack of announcements from policy makers or major economic reports during most of next week gives traders little reason to change direction.