Bond markets down on economy concerns

Bond markets down on economy concerns

Yields on US Treasury bonds feel to a three-month low on Wednesday on weak inflation figures, continuing credit market nerves, and worries about growth in Europe.

In New York at mid-day, 2-year Treasury bonds were down 3.3 basis points to yield 3.566 percent, while the 10-year bond was yielding 4.073 percent, a drop of 4.8 basis points.

In Europe, worries over a weak economy led to increased bond purchases and lower yields. Thirty-year notes were yielding 3.796 percent and the 10-year Bund fell to a yield of 3.273 percent.

Bonds in the UK were less volatile after news of an unchanged interest rate and mixed employment figures. Yields on the 10-year gilt fell 0.6 basis points to 4.338 percent.

Yields were also lower on Japanese government bonds as investors became more interested in long-dated issues. However, activity was fairly slow as investors awaited the results of a scheduled Bank of Japan policy meeting. Ten-year government bonds fell 2.5 basis points to yield 1.275 percent. 20-year bonds also were down by 2.5 basis points to a yield of 1.950 percent.

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