German Bonds Drop on Bank Plans; Belgian, Greek Debt Declines
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German 10-year bunds fell, pushing yields to the highest in more than five weeks, after Germany and France’s leaders said they will draw up a plan to recapitalize banks and stop Greece’s debt crisis spreading.
Belgian and French bonds slid as the nations pushed ahead with plans to support beleaguered lender Dexia SA. Greek and Portuguese securities also tumbled amid speculation bondholders may need to take greater losses on Greece’s debt as part of the rescue plan. Belgium’s debt rating was put on review for downgrade by Moody’s Investors Service on Oct. 7, and Fitch Ratings lowered Italy and Spain’s credit rankings the same day.