Yields and basis point (bp) movements of some of the most-watched 10-year bonds this afternoon:

US: 1.88% (-1bp)
UK: 1.96% (no change)
Germany: 1.44% (-1bp)
France: 2.16% (-1bp)
Spain: 5.16% (-8bp)
Italy: 4.79% (-4bp)

[NOTE: there are 100bp to a percentage point]

US bond yields slid by a single basis point to 1.88% after a raft of positive economic data was published.

The Institute for Supply Management - Chicago Business Survey rose for a second month up 1.2 points to 56.8. The business barometer was also concurrent with gains in new orders, order backlogs and supplier deliveries while production and employment expanded at a slower pace.

Data from the US Department of Labor showed that in the week ending February 23rd, the advance figure for seasonally adjusted initial claims was 344,000, representing a decrease of 22,000 from the previous week's revised figure of 366,000. The consensus estimate was for a smaller fall to 360,000.

Cooper Howes, an analyst at Barclays, commented: "We view labour markets as gradually but steadily improving, and this week's data are consistent with our forecast of a 150,000 increase in nonfarm payrolls, a 155,000 increase in private payrolls, and a one-tenth decline in the unemployment rate to 7.8% in the February employment report released on Friday, March 8."

Meanwhile, the Bureau of Economic Analysis at the US Department of Commerce issued a second estimate for gross domestic product in the fourth quarter. The output of goods and services produced by labour and property located in the US increased at an annual rate of 0.1% in the fourth quarter of 2012, compared with the initial estimate of a 0.1% contraction. The Bureau reported that Thursday's estimate was based on more complete source data than was available for the advance estimate that was issued last month.

In the UK, bond yields were flat at 1.96% on a day devoid of major monetary or economic announcements. The Office of National Statistics unveiled its quarterly migration statistics report for February 2013. This showed that 515,000 people immigrated to the UK in the year ending June 2012, significantly lower than the 589,000 who migrated the previous year. Some 352,000 emigrants left the UK in the year ending June 2012, similar to the estimate of 342,000 in the year to June 2011.

In Germany, bond yields fell by a single basis point to 1.44% as data published by Destatis Statistisches Bundesamt (the Federal Statistics Office) forecast that consumer prices were expected to rise by 1.5% year-on year in February. The statistics body reported that consumer prices were also expected to increase by 0.6% on January 2013.

It noted that the price rises for energy and food were markedly higher than the general inflation rate. Destatis data also showed that a total of 41.4m people resident in Germany were in employment, according to its provisional calculations. Compared with January 2012, this represented an increase of 243,000 persons in employment or 0.6%

In France, bond yields were down by a single basis point to 2.16% as the National Institute of Statistics and Economic Studies (INSEE) unveiled its services producer price indices for the fourth quarter of 2012. Prices for professional, scientific and technical service rose. Real estate service prices decreased slightly in the quarter by 0.5%. Prices for employment services increased by 0.8%.

Bond yields in Spain saw the biggest basis points fall out of all the countries whose bonds are monitored by ShareCast. Yields contracted by eight basis points to 5.16%. This happened as Spain's Secretary of State for the Economy, Fernando Jimenez Latorre, was reported by Reuters news agency as saying that Spain's economy would return to quarterly growth in the third or fourth quarter of this year.

In Italy, bond yields contracted by four basis points to 4.79% three days after the election produced an inconclusive result with no single political party gaining a majority position in the two key governing structures; the Lower House and the Senate.

MF

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