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German 10yr yield falls below 1% on a dire day for the eurozone

On a dire day for Europe's economies, yields on the German ten-bund fell below 1% for the first time. Figures out this Thursday show the eurozone's economy is completely flat, missing expectations of a tiny increase in GDP. Germany's economy contracted 0.2% quarter on quarter and growth in France was also less than expected at zero.

Saxo Bank's Head of Fixed Income, Simon Fasdal says this lack of growth, coupled with a deflationary risk, is one of the main drivers of these ultra low rates that are affecting developed countries around the world. Geo-political tensions are also weighing on sentiment. It begs the question as to whether we're seeing a "bond bubble". Simon believes that one could well be developing but it's not going to burst any time soon.

02:22 minutes
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