By Paul Dobson - Nov 30, 2011 2:46 PM GMT+0700
German bonds rose for the first time in seven days after euro-area finance ministers said more work was needed to enhance the role of the International Monetary Fund in fighting Europe’s debt crisis.
Ten-year yields dropped from near the highest in three months before reports that economists said will show German unemployment stayed at 7 percent, and euro-area inflation held at a three-year high of 3 percent for the third month. German retail sales rose more than economists forecast in October, the Federal Statistics Office said.
The 10-year bund yield fell four basis points, or 0.04 percentage point, to 2.29 percent at 7:34 a.m. London time, after climbing to 2.37 percent yesterday, the highest since Aug. 9. The 2 percent bond due January 2022 rose 0.35, or 3.50 per 1,000-euro ($1,327) face amount, to 97.40.
Germany’s 10-year breakeven rate, a measure of inflation expectations derived from the difference in yield between conventional and index-linked securities, was at 136 basis points, after narrowing to 128 basis points on Nov. 24.
German government bonds have returned 6.1 percent this year, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. U.S. Treasuries gained 9.3 percent.
To contact the reporter on this story: Paul Dobson in London at pdobson2@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
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