ECONOMY

Analysts see recovery in bond prices

The recent growth in the yields of Greek 10-year bonds, the market’s benchmark, is due to the government advertising a new issue of seven-year bonds in the coming weeks, according to market analysts.

Investors are opting to sell the debt they have in their hands to obtain the cash for them to buy the new government paper.

In recent days one major hedge fund and several smaller ones have sold the Greek bonds they held, putting pressure on the Greek market. However analysts point also to the existence of buyers, while noting that the situation will easily reverse as soon as some positive news crops up.

Other factors include the general climate of uncertainty which arises when the country’s creditors begin a new round of inspections and the lack of bond market support by the country’s banks.

The same analysts reject the theory of investor concern regarding the departure of the IMF from the Greek program, saying that the European Commission will continue to monitor Greece in one way or another.