Greek bonds slump as debt talks fail
Investors dumped Greek bonds on Monday, after talks on ending a deadlock between Athens and its international creditors broke down at the weekend and the prospect of a debt default drew dramatically closer.
Greek government bond yields spiked to the highest and stocks fell to their lowest since April.
“A default of some sort is now all but a certainty,” said Yiannis Koutelidakis, senior economist at Fathom Consulting in London.
The yield on two-year Greek government bonds spiked nearly 4 percentage points to just under 30 percent, the highest in almost two months, while the 10-year yield jumped to 12.7 percent, the highest since April 27.
The price of Greek corporate bonds also fell, pushing up yields.
The yield on Public Power Corporation’s 500-million-euro, 5.5 percent, five-year bond maturing in 2019 rose to 17.80 percent, the highest since its launch in May last year.
The yield on National Bank of Greece’s seven-year bond maturing in October this year scaled 20 percent.
At the turn of the year it was just 2 percent.
[Reuters]
