The extra yield investors demand to hold U.K. 10-year bonds instead of similar-maturity German bunds was set for the highest weekly close since 2005 amid speculation British growth will outpace that of Europe’s biggest economy.
Germany’s bonds declined, with 10- year yields rising from near the lowest in seven months, as tensions over Crimea eased after President Vladimir Putin said there was no immediate need to send Russian troops to Ukraine.
Portugal’s two-year notes rose for a third day after the nation said yesterday it will buy back debt as it works toward exiting its bailout program, adding to evidence the euro area is putting the debt crisis behind it.
Italian government bonds fell after data showed euro-area inflation was quicker than previously estimated and German business confidence improved, reducing pressure on the European Central Bank to boost stimulus.
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.