The European index DJStoxx 600 thus rose by 3

The difference in performance between European State bonds to 2 years and 10 years widened yesterday. On German debt, he hoisted at 196 points, close to the Summit reached on 6 February. The British rate, he broke a record with 237 points. This gap between short and long rate is explained by the first stabilization and the tension recorded on the latter.

Yesterday, several elements have weighed on long-maturity bonds, pushing rates higher. First, markets rebound net markets shares, The prospect of further measures to support the economy in China doped scholarships. The European index DJStoxx 600 thus rose by 3.89, while it had plummeted to a lowest in 12 years, Tuesday.

Returning to more risky assets, investors have shifted State of long-term bonds, which serve as a refuge. Moreover, concerns about the swelling of the supply of sovereign paper was heightened by the announcement of an upward revision of the programme of French debt emissions (see page 2). 145 Billion euros originally planned for 2009, the amount is EUR 155 billion of medium-and long-term securities. "Rates have jumped at the time of the announcement, the German Bund amount to its highest level in three days, note Ciaran O'Hagan, in Société Générale.". The risk of an increase in securities continues to scare investors. "It is in one of the reasons that explains the underperformance of State bonds to 10 years in Europe, but also in the United States since the beginning of the year. "The gap between the Bund and the French OAT to 10 years continues to grow and reached now 58 basis points, a new record," adds the strategist of Société Générale. The market thus expressed his dismay with the announcements of the France. The British bond market, he was affected by an issue of securities to maturity 2039, 2.25 billion pound sterling.

Perhaps surprises

Yet resisted European State bonds to 2 years. The prospect of reductions in interest rates in the euro area and the United Kingdom today offered support. The market anticipates a reduction in the rent of money on the part of the European Central Bank (ECB) by 50 points to 1.50, its lowest historical level. On the other hand the Bank of England (BoE) should cut interest rates even, to 0.5. "Some argue for a policy of rate zero in the euro area, as in the US and the United Kingdom, and, even within the ECB's Governing Council, said Cédric Thellier at Natixis"Nevertheless, the majority of the members and in particular the President, Jean-Claude Trichet, are reluctant, which suggests that the refinancing rate will reach a floor 1 in June.""

Market operators believe that the meeting of this day may reserve surprises. The ECB may mention other measures than those strictly related to monetary policy, according to some. However, this scenario is far more likely to the United Kingdom. "The monetary policy Committee should engage in a process of quantitative easing, by buying loans of British State and the assets of the private sector", said the team of Bank of America-Merrill Lynch. From Deutsche Bank, the purchases of debt should be maturities to 5 years.