ENP Newswire - 21 January 2014 Release date- 20012014 - BONDS: IRISH BONDS POWER AHEAD AFTER RATINGS UPGRADE FROM MOODY'S. The following were the yield and basis point (bp) movements of some of the most-watched 10-year bonds this afternoon: US: 2.82% (Holiday) UK : 2.83% (+0bp) Germany : 1.75% (-1bp) France : 2.40% (-1bp) Spain: 3.69% (-3bp) Italy : 3.81% (-2bp) Japan : 0.67% (-1bp) Portugal : 5.23% (+0bp) Greece : 7.83% (-2bp) Sovereign bond yields in the developed world ended the Monday session generally lower, lifted by Moody's decision, last Friday, to raise its rating on Ireland's sovereign debt back up to 'investment grade'. The yield on the country's 10-year bonds dropped by 20 basis points to reach 3.24%. That came as US markets were closed in observance of the Martin Luther King Jr. holiday. Acting as a backdrop, and ahead of the release, tomorrow, of the International Monetary Fund's World Economic Outlook, some reports were again highlighting the risks that could potentially follow from too-low inflation readings. In that regard, the Financial Times cited top-ranked HSBC economist Stephen King as having said that: 'We're not forecasting a descent into outright deflation. Instead, we're highlighting the risk that inflation remains too low or, worse, that it continues to sink over the next two years'. To take into account, tensions continued to be evident in Chinese short-term funding markets - which are thought to be linked to the upcoming Chinese New Year . The benchmark seven-day repurchase rate, a gauge of interbank funding costs, jumped by 153 basis points to 6.32% on Monday. Also in the emerging market sphere, default risks continued to rise in Thailand given the political uncertainty which has been hounding the Southeast-Asian nation. Lastly, and back in the UK , the Ernst&Young ITEM club raised its forecast for British GDP this year to 2.7%. However, it warned that the Bank of England might abort the recovery before it has reached escape velocity if it maintains its focus on employment even as real wages continued to fall.
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