AFP, Paris :
Returns on German government bonds, seen as a safe haven during market turbulence, fell sharply Wednesday on Donald Trump winning the US presidency as investors rushed to purchase the assets.
The yield, or the return on investment to investors, on 10-year Bunds fell to 0.098 percent in early trading on the secondary market, compared to 0.188 percent at the close on Tuesday.
Meanwhile the yield on 10-year French government bonds fell to 0.430 compared to 0.500 percent.
“The election of Donald Trump seems to trigger a risk-off mode,” said analysts at BNP Paribas bank.
Meanwhile analysts at ING Bank said: “We expect a risk off move for the next few days… the 10-year Bund yield might drop towards the 0.05 percent area.”
Market turbulence may also prompt the US Federal Reserve to hold off on raising interests rates in December, which would also influence investors willingness to hold lower-yield assets.
“Given the adverse market reaction we have already seen, the Fed’s planned December rate hike is now off the table,” Capital Economic’s chief US economist Paul Ashworth said.
Returns on German government bonds, seen as a safe haven during market turbulence, fell sharply Wednesday on Donald Trump winning the US presidency as investors rushed to purchase the assets.
The yield, or the return on investment to investors, on 10-year Bunds fell to 0.098 percent in early trading on the secondary market, compared to 0.188 percent at the close on Tuesday.
Meanwhile the yield on 10-year French government bonds fell to 0.430 compared to 0.500 percent.
“The election of Donald Trump seems to trigger a risk-off mode,” said analysts at BNP Paribas bank.
Meanwhile analysts at ING Bank said: “We expect a risk off move for the next few days… the 10-year Bund yield might drop towards the 0.05 percent area.”
Market turbulence may also prompt the US Federal Reserve to hold off on raising interests rates in December, which would also influence investors willingness to hold lower-yield assets.
“Given the adverse market reaction we have already seen, the Fed’s planned December rate hike is now off the table,” Capital Economic’s chief US economist Paul Ashworth said.
