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Developments in the Greek government bond market – March 2011

13/04/2011 - Press Releases

International government bond prices fell and yields rose. The increase in yields was mainly observed on short-term government bonds and the so-called “peripheral” euro area securities.

On the electronic secondary securities market for Greek government bonds (HDAT), yields rose significantly during the month of March. In particular, the 5-year benchmark bond yield, which recorded the highest increase by 214 basis points (bps), reached 16.15% at the end of March, while the 3-year benchmark bond yield rose by 83 bps, to 15.11%. In the longer tenors, the 10-year benchmark bond yield rose by 108 bps to 12.88% and the 30-year benchmark bond yield by 22 bps to 9.06%. As a result, the yield curve remained inverted and steepened, with the difference between the 30- and the 3-year bond yields reaching the level of -605 bps at the end of March from -544 bps at the end of February.

The spread between the Greek and the German 10-year bond yields was 953 bps at the end of March, compared with 862 bps at the end of February.

As for government benchmark bond prices, the 3-year bond price fell to 81.90 at the end of March from 82.56 at the end of February, the 10-year bond price to 65.28 from 69.52 and the 30-year bond price to 54.55 from 55.94.

Trading volume on HDAT in March rose to EUR 974 million, compared with EUR 847 million in the previous month and EUR 34.6 billion in March 2010. The daily average turnover was EUR 46.4 million in March compared with EUR 42.4 million during the previous month. Investor interest was mainly focused on bonds with remaining maturity below 3 years, which absorbed EUR 689 million worth of transactions, or 71% of the overall traded volume. Of the 834 orders executed on HDAT, 67% were “sell” orders and 33% “buy” orders.





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