Euro Bonds: Let a thousand yield curves bloom

No single benchmark yield curve has emerged for the euro. So there is some confusion about how Eurobond issues should be priced. That anomaly raises deeper questions about how government debt and its derivatives will trade in future and which electronic platform will grab the lion's share. David Shirreff reports.

Ask 10 investors, bond issuers and issuing houses which benchmark yield spread they look at to judge the relative value of a bond, and you may get 10 different answers. That is the joy of the new euro landscape, in which at least four governments are competing to have their bonds represent the benchmark rate on at least one point of the yield curve.