Bond Market Confronts Prospect of Quick Boost to German Spending
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A widely-watched gauge of the attractiveness of German debt fell to the most negative on record as policymakers discuss borrowing more to fund defense spending.
The German 10-year bond yield hit five basis points above comparable swaps, the most in data going back to 2007. The difference between yields and swap rates — known as the the swap spread — is an important yardstick of future issuance because bonds tend to weaken relative to swaps as the market anticipates more sales.
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