Treasuries were little changed, putting the 30-year bond on course for its biggest weekly gain this year, as economic data from Germany indicated the recession may have further to run, stoking demand for fixed-income assets.
The yields on 10- and 30-year bonds held near the lowest level in more than two weeks after a report showed Europe’s largest economy contracted more than forecast in the first quarter, slumping the most in at least four decades. U.S. core inflation excluding food and energy probably slowed in April, according to a Bloomberg survey.
“European numbers have come in lower than expected and that’s prompted investors to take a risk off the table,” said Charles Diebel, head of European rate strategy in London at Nomura International Plc. “The performance on bond markets has been strong this week, with yields falling quite sharply as the risk rally has petered out.”
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