Investing.com investing.com 22 Dec, 2020 11:45 am

EU Bonds Changing View On Government Debt But Treasuries To Still Rule In 2021

EU Bonds Changing View On Government Debt But Treasuries To Still Rule In 2021
Bonds Analysis by Investing.com (Darrell Delamaide/Investing.com) covering: Germany 2-Year, Germany 30-Year, United States 10-Year. Read Investing.com (Darrell Delamaide/Investing.com)'s latest article on Investing.com

p When Federal Reserve policymakers kept mum last week about shifting the balance of bond purchases toward longer-dated maturities, analysts began predicting higher yields and a steepening yield curve.Both are bearish for Treasuries as investors will shift out of safe-haven bonds and demand higher yields.The prospect of a substantial sale of EU bonds over the next few years is enlivening the European government bond market after the debut of SURE bonds in October was massively oversubscribed with €233 billion in offers for the €17 billion available.As government bond issuance has almost doubled over the past year, the ensuing trading activity has also made it more profitable to act as a primary dealer.

The December compromise on the EU budget framework freed the way for bond issuance to fund the €750 billion economic recovery plan, while another €60 billion are on tap for SURE.Treasuries, however, remain the largest and deepest bond market, and nothing from Europe will be able to match it in the foreseeable future.

Read full story at investing.com