Treasury Rally Drives Spread to German Debt to Lowest in Months
- US Treasuries have gained on signs that economy is weakening
- Outlook for European defense spending has weighed on bunds
A rally in Treasuries this month has driven down yields closer to German debt, as traders bet on bigger US interest-rate cuts and more borrowing in Europe.
The gap between both countries’ 10-year yields closed at 184 basis points on Tuesday, the narrowest since October. It’s set for the biggest monthly decline since May.