Treasurys came under pressure, pushing yields higher, on Tuesday amid reports that Germany was contemplating extending financial aid to Turkey, which is in the throes of currency crisis.
The 10-year Treasury note yield TMUBMUSD10Y, +1.18% rose 3 basis points to 2.880%, its highest in nearly two weeks, while the 30-year bond rateTMUBMUSD30Y, +1.16% advanced 3.6 basis points to 3.033%. The 2-year note yield TMUBMUSD02Y, +0.12% was up by 0.9 basis point to 2.661%, according to Tradeweb data.
Bond prices move in the opposite direction of yields.
The Wall Street Journal reported that German policy makers were worried about knock-on effects from deterioration in Turkey’s economy, which could potentially ripple though the eurozone’s banking system. Germany is the most influential and largest economy within the eurozone.
The WSJ report indicated that German officials are in discussions with Turkish counterparts over the form any assistance might take, but discussions are in the very early stages, and the article cautioned that they may ultimately fall apart. After the report’s release, a government official told Reuters that Germany wouldn’t offer direct financial aid, and was considering other options.
By Sunny Oh