Europe’s Deepening Gloom Is Captured By a Corner of Bond Market
- German 30-year asset swap spread hits widest level since April
- Move reflects “dim economic views,” ING’s Bouvet says
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One part of the European debt market is capturing the region’s deepening economic pessimism more starkly than elsewhere.
The spread between the 30-year swap rate, the price of locking in borrowing costs, and German bond yields is at its widest since April. That reflects both unprecedented demand for bonds as a haven and a diminishing appetite for hedging by debt issuers amid record-low borrowing costs, according to ING Groep NV.