Strong demand in the overnight auction of $14 billion of 20-year US Treasuries ensured advances for gilts across all maturities.
With appetite for the newly issued paper such that the yield on the 30-year stock fell below that of two-year US bonds, long-dated maturities on this side of the Atlantic had no choice but to follow their counterparts higher. But bond markets also received support from the single currency zone, where below-forecast fourth-quarter French GDP data sent euro-denominated debt higher. Elsewhere, Germany reported a dip in its consumer price index for January, which fell 0.5 per cent on the month. The March gilt future gained 33p to £114.26. Treasury 4¾ per cent 2010 improved 1p to £101.95, with Treasury 6 per cent 2028 50p better at £130.80. Germany’s Hypo in Essen added €250 million to its 2¾ per cent 2007 bond. Deutsche Bank set about pricing a €2 billion 8 per cent 2007 offering.