Friday, July 20, 2007

European Bonds Rally as Subprime Defaults Prompt Investors to Seek Safety

(Bloomberg) -- European government bonds rallied on
speculation defaults on U.S. subprime mortgages will hurt the
global economy, fueling demand for the safest assets.

Bunds gained, sending 10-year yields to their lowest in
almost three weeks, after the risk of owning European corporate
debt touched a two-year high. Government debt was buoyed this
week after Bear Stearns Cos. told investors they weren't likely
to get any money back from two of its hedge funds that bet on
securities backed by subprime mortgages.


Read more at Bloomberg Bonds News

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