Ten-Year Ezone Government Bond Spreads Versus German Bunds

January 4, 2013

The table below compares selected European bond spreads (e.g., Spain minus Germany) on the first trading day of last June to those of yesterday.  All the countries except Britain participate in the European Economic and Monetary Union, and all of the bond spreads except that between British gilts and German bunds narrowed, many of which by very substantial margins.  Indeed, the biggest shrinkage involved the three economies that have received bailout aid — Greece, Portugal, and Ireland.  The next largest implosions involve Italy and Spain, countries that haven’t requested outside aid but which were feared likely to do so until the European Central Bank announced its OMT program.  The data are expressed in basis points where 100 basis points equals a percentage point.

10Yr Bond Spread June 1, 2012 January 3, 2013 Change
Greece 2,937 987 -1,950
Portugal 1,209 495 -714
Ireland 627 298 -329
Italy 470 276 -194
Spain 535 353 -182
Belgium 178 72 -106
France 108 64 -44
Britain 37 59 +22

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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