Tue, Oct 03, 2017 - Page 11 News List

Spanish bonds fall to three-month low on Catalonia vote


Spain’s benchmark bonds fell to their lowest level in almost three months after Catalan separatist leaders signaled they might be moving toward a unilateral declaration of independence.

The nation’s 10-year bonds snapped a two-day rally as regional leaders suggested the declaration might come as early as this week.

“The sell-off makes sense, for today at least, given the headlines over the weekend, and therefore perceptions of increased domestic political risk and uncertainty,” London-based Standard Chartered PLC strategist John Davies said.

The yield on Spain’s 10-year bonds rose nine basis points to 1.7 percent at 9:11am in Barcelona, the highest since July 13.

The extra premium that investors demand to hold Spanish 10-year government bonds over similar-maturity German bunds, the eurozone’s benchmark sovereign securities, widened five basis points to 119 basis points.

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