Eurozone bond yields down again

In the eurozone, yields were down yet again on Wednesday as the Dutch central bank cut its 2005 growth forecast from 1.7 percent to 0.4 percent.

The change in the forecast was blamed on high oil prices and global economic slowdowns, and increased speculation that the European Central Bank could cut interest rates by the end of the year.

Yields on the 10-year Bund were down to a record low of 3.12 percent.

In the UK, yields on gilts fell to their lowest levels in 2 years. The 10-year gilt was yielding 4.214 percent, down 2.7 basis points. The Bank of England was scheduled to hold a monetary policy meeting, but a changes in interest rates were expected.

In Japan, 10-year government bonds yielded 1.230 percent, while 5-year issues rose 1 basis point to a yield of 0.425 percent, remaining close to 22-month lows.

In the US, prices were down and yields up on Treasury bonds before Thursday’s appearance of Federal Reserve chairman Alan Greenspan in front of a congressional committee to discuss the country’s economic outlook.

Yields on 2-year bonds rose 2.5 basis points to 3.591 percent, while 10-year yields were up 1.5 basis points to 3.922 percent. The yield on 5-year bonds stood at 3.71 percent ahead of a sale of $14 billion in new issues, and 30-year bonds yielded 4.2 percent.

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