German Bunds Rise as Confidence Gauge Drops More Than Forecast

Germany’s government bonds rose, with yields approaching the least in a year, after a gauge of German investor confidence fell more than economists predicted, adding to speculation euro-area interest rates will stay low.

Yields on two-year notes were about two basis points from falling to negative after European Central Bank President Mario Draghi said yesterday that risks to the region’s economic outlook are to the “downside.” Spanish securities advanced even as Draghi said in testimony to the European Parliament yesterday that banks shouldn’t count on a fresh round of ECB cash to buy sovereign debt. Portugal’s bonds fell for the first time in three days.