• German 10-year bond yield hits new record low of -0.24 pct as UK votes to leave EU

    Source: FxWire Pro - Money Market / 24 Jun 2016 03:11:02   Eastern Standard Time

    The German 10-year bund yield fell to an all-time low of minus 0.24 percent on Friday after Britain has voted to leave the European Union in an historic referendum which has thrown Westminster politics into disarray and sent the pound tumbling on the world markets.

    The yield on the benchmark 10-year bonds, which moves inversely to its price fell more than 21 basis points to -0.122 percent, yield on super-long 30-year bonds dipped nearly 30 basis points to 0.453 percent and the yield on short-term 2-year note tumbled 9 basis points to -0.650 percent by 07:00 GMT.

    Britain has voted to leave the EU in a popular revolt that will send shockwaves across Europe, leaving David Cameron’s premiership hanging in the balance and triggering financial market turmoil across the globe. With all the votes counted, 51.9 percent voted to sever Britain’s 43-year membership of the EU, 48.1 percent to stay in.

    Interestingly, Farage declared victory in a speech held in London as a Brexit looked increasingly likely.

    "The dawn is breaking on an independent United Kingdom," he said to loud cheers at a Leave campaign party.

    Today, crude oil prices dropped more than 6 percent as 'Leave' Camp Leads in 'Brexit' Vote. Meanwhile, the International benchmark Brent futures fell 6.40 percent to $47.63 and West Texas Intermediate (WTI) climbed 6.31 percent to $46.95 by 05:20 GMT.

    Following the UK referendum decision to leave the EU the FX market has gone into meltdown with the Pound falling massively overnight. GBP/JPY is currently down almost 13 percent, GBP/USD -9 percent, GBP/CHF -7 percent and GBP/EUR -6 percent, and these are not the low points reached.

    At one stage overnight GBP/JPY was down by 15.3 percent on the day at 133.50, GBP/USD was down 11 percent at 1.3240, GBP/CHF -9.6 percent at 1.2875 and GBP/EUR -7.7 percent at 1.2035. Markets remain highly illiquid and volatile say traders with no sign of any G7 joint intervention, so far.

    Meanwhile, the British pound has been absolutely hammered by the news that Britain has voted to leave the EU. Sterling has suffered its biggest ever drop, and is currently hovering around $1.36, down 8.5 percent (falls to lowest since 1985).  The UK FTSE 100 futures (delayed feed) indicate an opening around 5,750 points, down 8.7 percent, French CAC tumbled -11.6 percent and Japanese Nikkei closed almost 8 percent lower. The German stock index DAX Index fell 9.90 percent at 9,242 by 07:00 GMT.