LONDON, June 25 (Reuters) - Italian government bonds sold off while safe haven German Bunds were in demand on Monday as the European Union struggled to find common ground over an influx of migrants from the Mediterranean region in recent years.
German Chancellor Angela Merkel conceded on Sunday that the bloc had failed to find a joint solution to the issue threatening her government and said she would seek direct deals with separate European Union states on migration.
Italy’s 10-year bond yields jumped 5 basis points in early trade and the closely watched bond yield spread over Germany — seen by many as a proxy for sentiment towards the bloc — hit its widest level in two weeks at 244.5 bps.
Germany’s 10-year government bond yield, the benchmark for the region and a haven for investors in uncertain times, hit its lowest in nearly a month, down 2 bps at 0.315 pct. (Reporting by Abhinav Ramnarayan, editing by Karin Strohecker)