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Developments in the Greek government bond market: July 2010

20/08/2010 - Press Releases

On international markets government bonds had a mixed performance in July. In Euro-zone “peripheral” markets government bonds recorded gains, whereas in Germany government bond prices fell and yields rose particularly on short-term maturities. In addition, in the US market government bonds had a positive performance with the exception of the 30-year bond that recorded losses.

On the Greek electronic secondary securities market (HDAT), Greek government bond yields fell during July, in line with the performance seen in the rest of the “peripheral” Euro-zone markets. The biggest decline was recorded in the 30-year benchmark bond yield that declined by 80 basis points (bps) to 8.65% at the end of July, followed by the 15-year benchmark bond yield that fell by 59 bps to 10.06%. In addition, the 3 and the 10-year benchmark bond yields declined by 27 and 21 bps respectively to 11.04% and 10.24% on July 30. As a result, the yield curve remained inverted, with the difference between the 30- and the 3-year bond yields reaching -239 bps at the end of July, compared to -186 bps at the end of June. Finally, the spread between the Greek and the German 10-year bond yields narrowed to 756 bps at the end of the month from 789 bps on June 30.

As for government benchmark bond prices, the 3-year bond price rose to 85.11 at the end of July from 84.19 at the end of June, the 10-year bond price rose to 75.70 from 74.56 and the 30-year bond price rose to 57.00 from 52.01.

Trading volume on HDAT in July amounted to EUR 1.5 billion worth of transactions, compared to EUR 1.6 billion in the previous month and EUR 18.2 billion in July 2009. The daily average turnover was EUR 66.5 million compared with EUR 71.5 million during the previous month. The most actively traded bond during the month was the 5-year bond maturing on August 20, 2015 with EUR 200 million worth of transactions. Of the 1,117 orders executed on HDAT, 55.3% were “sell” orders and 44.7% “buy” orders.





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