Greek bond yields fall after ‘friendly’ Schaeuble comments
Greek government bond yields fell sharply on Thursday after German Finance Minister Wolfgang Schaeuble said Athens was on the right track in terms of reforms.
“If the reforms already under way in Greece are continued then Greece can have further successes,» Schaeuble told the German parliament.
Investors took those comments as a sign of European support for Greece a day after the parliament in Athens failed to pick a new head of state at its first attempt. If two further ballots prove fruitless, snap elections might have to be called.
“Schaeuble is making some friendly comments … it suggests that a lot of things are being done behind the scenes to try to contain any potential damage from (a scenario in which Syriza wins early elections),» one trader said.
Italian Economy Minister Pier Carlo Padoan said on Thursday that possible fallout from Greece’s political showdown would not trigger a euro zone debt crisis like the one that pushed Italy close to default three years ago.
Greek three-year yields fell the most, down 91 basis points at 9.87 percent, while five-year yields dropped 65 bps to 9.12 percent and 10-year yields were down 41 bps at 8.51 percent.
[Reuters[
