German yields reached six week highs after speculation that Spain would ask for a bailout as Spanish yields reached relative lows. Last week at this time short duration German bond were trading more negative than this week. For example, last week’s 6-month German yield was .1%, this week the yield is .02%. I will keep my eye out for any developments in Europe with regards to Spanish bailouts.
Opportunity still exists for traders to profit from the front end inverted yield curves of the UK and Australia.
David Cornes holds a degree in economics from the University of Montana.
