Bonds rise on ECB, Greece

Global bond prices rose and yields declined during Wednesday’s morning session, as the European Central Bank (ECB) hinted it would speed up its bond-buying. The ECB suggested it could "moderately" increase its buying in May and June to make sure it’ll meet its target.

The bank suggested it would look to buy bonds faster in preparation for the Summer period, when liquidity declines while traders go on holiday. However, the move could also be designed to shore up markets from the recent global bond rout.

The bond market selloff saw yields spike to multi-month highs, effectively erasing the benefits of the ECB’s quantitative easing programme. Therefore, while it’s true that bond markets do suffer liquidity issues in the height of summer, the bank’s comments likely aim to push back against the rout.

However, bonds are also more in demand due to the ongoing Greek debt saga. Fears of a Greek default continue to mount and risk appetite consequently fades.

Yields on 10-year Bunds fell by seven basis points, while Italian and Spanish equivalents tumbled by 12 basis points.