Bond market pressures have recovered as a spike in inflation pushes up interest rates in the futures money market.
Despite the outspoken denials by the ECB leadership to the contrary, interest rates in the futures market “incorporate” at least two increases by the end of 2022. This development is largely due to “market automation”, as the “mechanism” with which it operates necessarily takes into account inflation data. In other words, as analysts estimate, as long as inflation continues to move at twice the rate (4.1% in October) of the ECB target, interest rate pressure will remain high, causing sharp fluctuations and nervousness in the bond market.
Measures to tackle the inflation threat seem to be gradually shifting from the ECB to national governments. In this context, the chief economist and member of the Governing Council of the ECB P. Lane called on EU governments to assist the ECB in reducing inflation by adopting a more restrictive fiscal policy. As he said, fiscal policy can be expansionary when inflation is below the 2% target, but when it deviates significantly from it it should become more restrictive. He suggested that the new fiscal rules discussed in the context of the revision of the Stability Pact also take into account the inflation target.
In the domestic secondary market, the yield on the 10-year bond was around 1.21%. The yield of the 5-year bond moved upwards to 0.39% from 0.33% as well as that of the 15-year bond to 1.28% from 1.19%.
In the Electronic Transaction System of the Bank of Greece (HDAT) transactions of 116 million euros were recorded, of which 42 million euros related to purchase orders. The yield on the 10-year benchmark bond stood at 1.25% from 1.15% against -0.26% of the corresponding German bond, resulting in a margin of 1.51%.
In the foreign exchange market, the European currency fell below 1.15 today, as it traded early in the afternoon at $ 1.1444 from the $ 1.1452 that the market opened.
The indicative price for the euro / dollar exchange rate announced by the European Central Bank was $ 1.1448.
.
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
