⁍ ECB has bought 13.5% of Greece’s bond debt pile in just four months.
⁍ Greece sold three-month bills with a negative yield on Wednesday.
⁍ It is also expected to be the biggest beneficiary of the 750 billion euro recovery fund.
– The Greek 10-year bond yield hit a record low of 0.91% on Thursday, reports Reuters, thanks in large part to the European Central Bank’s efforts to support the country’s economy. Since late March, the ECB has bought some 73 billion euros in Greek debt, or 13.5% of the country’s debt pile. That’s helped Greece outperform its peers in the eurozone, and it’s been a boon for investors who’ve been scooping up higher-yielding assets. “It’s like putting a put in the system and essentially yield control at the higher level, which then encourages people to take risks,” says a strategist at Nordea Asset Management. “They’ve crushed yields and people are running carry trade on the back of that,” he adds, referring to a trade in which investors use cheap funds to buy higher-yielding assets. Greece sold three-month bills with a negative yield on Wednesday. And it’s also expected to be the biggest beneficiary of the 750 billion euro recovery fund the European Union agreed last month, set to receive nearly 17% of its GDP across grants and loans. Government bond yields across the euro area also fell on Thursday after markets digested new bond sales from France and Spain, which sold roughly 14 billion euros of bonds between them. Reuters quotes showed Italy’s 10-year bond yield falling below the psychologically important 1% level for the first time since early March. Other platforms showed it breached that level two weeks earlier.
Source: https://www.reuters.com/article/eurozone-bonds/update-2-ecb-purchases-push-greek-10-year-bond-yields-to-record-low-idUSL8N2F83NY