French 30-year bond yield falls on ECB ‘operation twist’ talk

That will make disappointing reading for policymakers at the European Central Bank (ECB), who are expected to signal today a bias towards cutting its already-negative deposit rate this year to try to boost growth and inflation

LONDON: Speculation that the European Central Bank (ECB) will introduce an “operation twist” after it ends its asset-purchase plan is turning the French yield curve on its head.

The yield on France’s 30-year bonds dropped to its lowest level in 19 months on Tuesday, reducing the premium over five-year notes to the least since November 2016. A media report last week said that the ECB will reinvest proceeds from maturing bonds into longer-dated securities amid a shrinking pool of eligible debt.