The German 10-year bond yield has a negative first – Yahoo Finance Spain

By Dhara Ranasinghe

LONDON (Reuters) – The yield on German 10-year sovereign bond spent Tuesday into negative territory for the first time, because the demand for safe haven assets increased by growing fears that the UK can vote in favor of leaving the EU in a referendum next week.

the 10-year Bund, which is a reference to measure the costs of public funding over the euro zone fell more than 2.5 basis points to -0.002 percent.

The negative performance of the German 10-year bond joins a global club of sovereign bonds with yields below zero worth more than 10 billion dollars.

Nervousness by Brexit it has been the trigger for the German bond pass to negative returns. The pound weakened 1 percent against the dollar on Tuesday and European shares fell nearly one percent.

The British campaign to leave the EU had seven points before the referendum scheduled for 23 June showed on Monday an opinion poll. Meanwhile, the best-selling newspaper in the country urged his readers to vote to leave the block.

“The story for all financial markets now is the Brexit” said Cyril Regnat, fixed income strategist Natixis. “In recent days, we have seen sales in risky assets and there is a perfect storm for negative yields on German curve,” he added.

The decline in the performance of the benchmark 10-year ballasted five points to 0.57 percent bond yields to 30 years.

The referendum has diverse consequences in the rest of Europe, where support for political and economic union has faded to low growth and high unemployment

Although uncertainty has fueled demand for German bonds, riskier markets in southern Europe have received a setback.

The 10-year bonds rose 5 basis Portugal to points to 3.29 percent, its highest level in a month. Spanish and Italian counterparts, which posted their biggest one-day rise in months, rose 2.5 basis points each.