Italy Is Just One Reason Bunds Will Weather Treasuries Tumult
- A dovish ECB is helping to keep German debt well supported
- Weaker euro also makes Bunds more attractive to U.S. investors
This article is for subscribers only.
Investors inclined to sell Treasuries without batting an eyelid are unlikely to repeat the feat on German Bunds.
While 10-year Treasuries have had the worst start to a month since March last year, Bunds haven’t exactly been rocked by volatility. German notes are being shielded by a host of factors, not the least of which are the European Central Bank’s reluctance to raise borrowing costs, political risks looming large over Europe and a currency-adjusted yield that compares favorably with U.S. bonds.