Like the stock markets, the bond markets have also apparently forgotten about Brexit worries for the time being.
Concerns that followed the June 23 vote by the British to withdraw from the European Union seem to have disappeared. On the contrary, bonds are in great demand once again, including those from the southern euro-zone countries.
In return for the resulting rise in prices, yields on 10-year Spanish and Italian bonds have reached historic lows. The yield on the 10-year Spanish government bond fell below the 1-percent mark on Tuesday, to 0.95 percent, while that of the comparable Italian government bond slipped to 1.07 percent.
This lack of concern among investors is also reflected in yield markups on German government bonds. After the Brexit vote, the risk premiums jumped to above 1.6 percent, the highest level since the fall of 2015. Meanwhile, risk premiums have fallen to only about 1 percent.