July 19 (Reuters) – The premium investors demand to hold 10-year Irish government bonds rather than euro zone benchmark Bunds rose on Monday after ratings agency Moody’s Investors Service downgraded the sovereign’s debt.
Moody’s downgraded Irish debt by one notch to Aa2 from Aa1, but raised the outlook to stable from negative, capping the risk of further downgrades. [ID:nWLA8628]
Analysts also said that ahead of Irish bond supply on Tuesday, the country’s bonds were cheapening off, driving yields higher agains Bunds. [EURODEBT/O]
The 10-year Irish/German government bond yield spread IE10YT=TWEBDE10YT=TWEB widened by nine basis points since the Friday settlement close to 300 bps, its highest since July 2. (Reporting by George Matlock)