Everyone is interested in the rise in German bund yields.
To refresh: On Wednesday, Germany had a “failed” bund auction, meaning the auction did not attract as many bids as expected. Now granted, Germany sill borrows at incredibly cheap rates, but suddenly people are noticing something. German yields are rising, even as stress in the rest of the Eurozone grows. This is a crucial development, since heretofore, Eurozone stress was associated with lower German yields, as investor money flowed from the periphery to the continent’s one fiscally sound country.
Anyway, this is from Goldman’s excellent “Charts That Matter” series, and it nicely sums up what’s gone on.
Photo: Goldman Sachs