Germany sold its 30-year debt at a record-low yield at an auction on Wednesday, in a sign that the safe haven demand has recovered.
The safe haven appeal of German debt suffered a blow after Moody's downgraded the outlook of the triple A rated sovereign to 'negative' from 'stable' late Monday, pushing the country's 10-year yield higher yesterday.
The country raised EUR 2.322 billion from the sale of its 2.50 percent July 2044 Federal Bonds or Bunds against a target of EUR 3 billion, Bundesbank said. The auction drew bids totaling EUR 3.367 billion. An amount of EUR 678 million was set aside for secondary market operations.
The yield fell to a record-low 2.17 percent from 2.41 percent paid in the previous sale on April 25. The bid-to-cover ratio, which reflects investor demand, rose to 1.5 from 1.1 in April.
Germany also sold 0.10 percent April 2023 inflation-linked bonds today. The sale raised EUR 752 million against a target of EUR 1 billion and bids totaling EUR 1.422 billion. The yield on the linker was a negative 0.39 percent and the cover ratio was 1.9.
Data released today gave signaled worries over the German economic outlook. The Ifo Institute's business confidence index dropped for the third straight month to its lowest level in more than two years. Heightened tensions surrounding the debt crisis weighed on business expectations, more notably in the manufacturing sector.
The latest purchasing managers' survey by Markit Economics revealed Tuesday that the private sector contracted in July, marking the weakest performance since June 2009. Both services and manufacturing activity declined during the month.
For comments and feedback contact: editorial@rttnews.com
Economic News
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.