Low Yields Points to European Confidence

The European bond market is signaling that the continent’s economy is “probably going to be OK,” Starwood Capital chief Barry Sternlicht told CNBC on Wednesday.

“I’ve been watching the 10 year in Spain and Italy all year. As soon as [the yields] broke 4 [percent], it’s kind of like a referendum that Europe is going to at least get through. At least the Euro risk is done,” said Sternlicht, whose private equity group has $33 billion in assets under management and focuses heavily on real estate.

The bond yields are converging, he said in a “Squawk Box” interview. “So now you have the Spanish and Italian 10 years trading around where the U.S. 10 year [Treasury] is or getting close.”

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza