Greek state bond yields fell again on Friday, following a significant decline the previous day, as a cautious stance adopted by the European Central Bank on its support measures gave a boost to south European debt markets, particularly the Greek market, which benefits more from ECB’s PEPP programme.
The Greek 10-year bond yield fell 3.5 basis points on Friday to 0.754 pct, while five-year bond yields fell more to 0.017 pct. This development reversed increases in bond yields recorded before the ECB meeting as investors bet that an increasing inflation in the Eurozone could lead the central bank to a decision to withdraw its emergency support programme. Greece was included in the bond buying programme in the framework of emergency measures announced by ECB following the outbreak of the pandemic, for the first time since 2014. “If the PEPP programme was extended this would be obviously supportive, particularly for Greek bonds,” Antoine Bouvet, an analyst in ING said.