Spain's Bond Spread Widens in Week One of ECB Expanded Buying

Spain’s government bonds headed for a weekly drop despite this being the first full week of the European Central Bank’s expanded stimulus program.

The extra yield, or spread, that investors get for holding Spanish 10-year bonds instead of similar-maturity German debt is set to widen this week by the most since July 3. The ECB increased the size of its monthly bond purchases to 80 billion euros ($91 billion) from 60 billion euros starting April 1.

Spain’s 10-year bond yield fell three basis points, or 0.03 percentage point, Friday to 1.58 percent as of 8:56 a.m. London time, paring this week’s increase to 14 basis points. The 1.95 percent security due in April 2026 rose 0.25, or 2.50 euros per 1,000-euro face amount, to 103.44.

Benchmark German 10-year bund yields were little changed Friday at 0.10 percent, leaving the spread with the Spanish securities 17 basis points wider on the week at 147 basis points.

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