Irish bond yields up 0.25%

Irish bond yields rose by 0.25% in trading yesterday on the back of comments made on Tuesday night by the finance ministers from Germany, Holland and Finland that appeared to rule out a deal on Irish bank debt.

Fixed income dealer at Danske Bank, Owen Callan, doesn’t expect Irish bond yields to drift much higher from these levels. But it is unlikely that Irish yields will trade lower until there is a resolution to the Spanish banking crisis. Also, there is much more certainty over the complexion of an EU banking union, he adds.

The surge in bond yields followed a general sell-off of periphery eurozone debt and equities. Spanish bond yields rose 30 basis points to breach the 6% level.