It's Getting Congested: The World's "Three Handle" Ten Year Bonds

Tyler Durden's picture

Forget "the 1%-ers", meet the 3%-ers. As US Treasuries sell-off and European bonds continues to surge, the 3% handle on government debt is becoming a crowded trade with the following six nations now yielding between 3 and 4%... US, UK, Ireland, Israel, and drum roll please... Italy and Spain!

  • US 3.008%
  • UK 3.044%
  • Ireland 3.389%
  • Israel 3.70%
  • Italy 3.98%
  • Spain 3.99%

Bear in mind that a year ago the spread between Spain and US was 350bps and is now less than 100bps...in some wierd world that all makes sense, we are sure.

 

Note today saw European stocks selling off (apart from Greece which roared 4% higher) but European bonds screamed lower in yield with Portuguese spreads 30bps tighter today alone and Spain and Italy 18bps tighter!! This is a perfect echo of 2013's first day ramp (and the biggest spread compression since 1/2/13!!)

 

Everyone front-running ECB QE?

Chart: Bloomberg