Long-Term Yield Spreads to Germany - Part 1

Monetary review, 1st Quarter 2013

Authors Abildgren, Kim; Risbjerg, Lars; Ristorp Thomsen, Casper; Altenhofen, David; Lohff, Jane Lee; Christensen, Nicolaj Hamann; Ejsing, Jacob Wellendorph; Hansen, Signe Skovgaard; Thamsborg, Susanne Hougaard
Subject Monetary conditions; Interest and exchange rates; Danish Government Borrowing and Debt
Type Monetary Review  
Year 2013
Published 15 April 2013
Link to publication Monetary review, 1st Quarter 2013
Abstract icon This article contains a non-technical summary of the four articles in Part 2 of this Monetary Review which examine the determinants of long-term government yield spreads to Germany for a number of EU member states. Yield spreads tend to be lower for countries with sound public finances and macroeconomic balances under control than for countries with substantial government debts and macroeconomic imbalances. However, economic fundamentals are far from always the only determinant of yield spreads. In certain periods, market-related and institutional factors, assessments from the international credit rating agencies and policy initiatives have played a key role in yield spread developments.