German bond yields soar above gilts as Japan dumps bunds

The yield on German bunds has risen above UK gilts for the first time since 2009 after Japan shifted out of bunds overnight following Germany's disastrous debt auction.

Benchmark 10-year bunds are this morning yielding 2.24%, higher than 10-year gilts at 2.19% at 08:12am, following a huge drop in the price of German debt. It is the first time gilts have yielded less than bunds since 2009, according to Bloomberg. Wholesale selling of bunds by the Japanese, as well as by other foreign investors, has caused prices to plunge and yields to soar, while demand for gilts has increased dramatically. Money managers in Japan scooped up 1.53trn yen ($19.9bn) of UK gilts in the first nine months of the year, according to Bloomberg, on course for the largest an...