Spain Shows Investors Seek Higher Yields Amid Subdued Inflation
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Investors are looking past the euro area’s low inflation rate as they seek higher returns amid record-low yields in the region’s conventional sovereign bonds.
Spain’s borrowing costs dropped at an auction of 10-year government securities linked to euro-area inflation after data confirmed consumer-price growth in the region’s largest economies remained subdued last month. The European Central Bank published its survey of professional forecasters today in which predictions for euro-area inflation were cut through to 2016. Italy’s bonds were little changed as the nation sold 6 billion euros ($7.5 billion) of debt.