Wed. Apr 24th, 2019

The 'bund' returns to maxima from March before the uncertainty of the growth of Germany

The 'bund' returns to maxima from March before the uncertainty of the growth of Germany


Although minutes before the opening of the market the 'bund' came to reach a negative return of -0.022%, finally ended up climbing to eight basis points, reaching an intraday maximum of 0.061%.

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According to information from the agency 'Reuters', which cites anonymous sources, the German government plans to halve the country's growth outlook for 2019, to stand at 0.5%. Last week, the main German economic forecast institutes revised their forecast to 0.8%, from the 1.9% anticipated last September.

Although the Executive has not confirmed that reduction, the president of the central bank of Germany, Jens Weidmann, has assured that the growth of the Germanic country will slow down this year because the commercial disputes and the Brexit are affecting exports and investment activity .

The International Monetary Fund (IMF) again cut this week its growth forecast for Germany to 0.8%, after having been adjusted last January to 1.3%, six tenths less than anticipated at the end of 2018.

Weidmann, who is in Washington on the occasion of the spring meetings held by the IMF and the World Bank, added that the new forecast of the entity chaired by Christine Lagarde is plausible.

The increase in the interest paid for the 10-year German bond has reduced the Spanish risk premium, which is the difference between the Spanish bond with 10-year maturity and the 'bund'. Thus, the risk premium has fallen below 100 basis points for the first time since mid-March.

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