Italy’s government bonds rose, with 10-year securities extending a fourth weekly gain, as Prime- Minister-designate Matteo Renzi prepared to name his cabinet amid speculation he will accelerate economic reform.
Spain’s 10-year government bonds fell, snapping gains that pushed the yield below 3.5 percent for the first time in eight years, before the country sells as much as 5 billion euros ($6.88 billion) of debt tomorrow.
The pound approached a 2 1/2-year high versus the dollar before data tomorrow analysts said will mark the first full year the U.K. economy expanded in every quarter since the financial crisis began in 2007.
U.K. government bonds advanced for a second week, with 10-year yields falling the most since September, as reports showed service growth slowed last month and industrial production stagnated in November.
Treasury yields were three basis points away from the year’s low before a report forecast to show U.S. housing starts near recession levels, adding to concern about the recovery and boosting demand for the safety of bonds.
European government bonds rose, with German 10-year yields snapping their biggest gain in two months, before a report this week that economists said will show euro- area growth slowed in the third quarter.
Economist forecasts for Treasury yields at the end of 2014 are the highest since Bloomberg began surveying for the figure in July amid speculation the Federal Reserve will start cutting bond purchases as soon as next week.
U.K. 10-year bond yields fell to the lowest level in more than a week as investors awaited publication tomorrow of minutes of the Bank of England’s November meeting, which will show how policy makers voted.