Bonds calmer after treasury announcement

The excitement caused by the announcement Wednesday that the U.S. Treasury might again issue 30-year bonds calmed down on Thursday, allowing prices on European and UK long-term government bonds to begin to recover.

Wednesday’s announcement had sent prices on the long-term bonds falling and yields rising. Meanwhile, the general election in the UK seemed to be having very little effect on gilt prices.

In afternoon trading in London, prices were higher and yields were lower. Yields on the 10-year gilt was down 2.1 basis points to 4.522 percent. The 2-year gilt was down 2.1 basis points as well, to 4.493 percent, and the yield on the 30-year gilt was down 2 basis points to 4.455 percent.

In Europe trade was light with several nations’ markets, including Germany, closed for a holiday, making volume light. The 10-year Bund held steady at a yield of 3.402 percent. Yields on the two-year Schatz was down 0.6 basis points to 2.227 percent. 30-year bond yields were down to 3.980 percent, down 0.6 basis points.

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