Volatility among major currencies fell to the lowest since 2007 as global central-bank balance sheets continue growing, driving more liquidity into financial markets, even as the economy worldwide recovers.
The yield premium investors demand to hold Italian 10-year bonds over their German peers narrowed to the least in three years on bets the European Central Bank will take further action to combat low inflation.
Emerging Sovereign Group LLC, the $5 billion hedge-fund firm owned by Carlyle Group LP, posted losses this year in two of its funds after wrong-way bets on emerging markets, Europe’s recovery and U.S. Treasuries.
Euro-area consumer confidence unexpectedly increased to the highest in six and a half years in April, after the unemployment rate retreated from a record and the single currency bloc’s recovery gained momentum.
Royal Philips NV said the strength of the euro will make 2014 a “challenging” year after the world’s biggest lighting manufacturer reported first-quarter earnings that missed analyst estimates. The stock declined the most since June 2011.
European government bonds advanced this week, with Italian and Irish yields falling to the lowest levels on record, as prospects of further European Central Bank stimulus fueled demand for the region’s debt securities.