The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Euro government bonds: The shape of things to come

A single European currency looks increasingly likely to be instituted on schedule on January 1 1999. With this in mind government bond strategists are trying to predict the likely shape of the euro market. A few patterns, such as the transition towards a credit-driven market, are emerging. But much still hinges on decisions yet to be taken. Philip Eade reports

When politicians from the so-called Club Med countries of southern Europe say they intend to qualify in time for the first round of the EU's economic and monetary union (Emu) ­ due to start, as the Bank of England has taken to saying, in just 550 business days' time ­ it's time for the financial markets to sit up and take notice. That they have done so seems clear from recent movements in bond market indices and the growing demand for advice and information on the likely shape of new markets.

By late last month, following budgets in Italy, Spain and Portugal designed to meet Maastricht treaty criteria for entry to a single currency, the yields on the long-term government bonds of each of these countries had fallen by around 100 basis points over German Bunds since the beginning of the month, to 230bp for Italian bonds and 150bp for Spanish and Portuguese ones.

But just as discussions about which countries will be in and which will be out of Emu have moved to a new stage, so too has the debate about the future shape and mechanics of the euro government bond market.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree