Italian Bonds Advance With Spain’s as Reports Signal Recovery

Italian and Spanish government bonds rose for a fourth week, the longest streak since May, after an improvement in euro-area services output and German factory orders spurred demand for the region’s higher-yielding assets.

Italy’s 10-year yield dropped to the lowest in eight weeks, narrowing the spread versus German securities, as separate data showed the nation’s recession eased in the second quarter. Greek bonds advanced for a fifth week. German bunds declined as signs the euro area is recovering from a record-long recession damped demand for the region’s safest assets. Trading volumes declined as investors awaited the next Federal Reserve policy meeting and Germany’s federal election.