Below his psychological limit 4% went down today after about six months n performance of Greek 10-year bond.

In the early afternoon, the Greek 10-year bond was trading at a yield of 3.96%, while for example the yield of the corresponding Italian bond was at 4.14%. The rise in the prices of Greek bonds a week before the elections, at the same time that the prices of most European bonds were declining, demonstrates that the so-called political risk does not affect the market.

In addition, markets are discounting that the ECB’s key interest rate will rise further by 0.5% to 3.75%, as the central bank’s current forecast is for inflation to fall below 3% in the final quarter of the year. Therefore, according to market executives, the positive performance of the domestic bond market, according to market executives, shows that investors are not afraid of the possibility of a fiscal derailment the day after the election. Already the achievement of a primary surplus in the Budget from last year was a positive surprise.

Also, the decline in yields that has been observed throughout the last period and peaked today, reflects the expectation of investors for the upgrade of the Greek economy to the investment grade by the Rating Houses, apparently after the elections. In the domestic market, and specifically in the Electronic Transaction System (EDAT) of the Bank of Greece, strong buying interest was observed, as transactions of 102 million euros were recorded today, of which 98 million euros were purchase orders.

The yield of the Greek 10-year bond stood at 3.99% versus 2.25% of the corresponding German bond, resulting in a spread of 1.74%. In the foreign exchange market, the dollar is moving upwards, with the result that the European currency is trading at $1.0882 from the level of $1.097 that opened the market.