Spanish bondholders to face Irish-style haircuts

Yesterday, yields on benchmark 10-year Spanish bonds once again moved into dangerous and unsustainable territory above 7%. More worryingly, the country's 2-year bonds saw yields jump by 50bps in a single day, to 5.5%. Yields on the shorter-term debt have more than doubled from the 2.5% mark seen in March. The yield curve in Spain has flattened as a result, with the 10-year bond climbing more slowly from its March level of 5.18% to its current level of 7.19%. Henderson bond fund manager John Pattullo said the flattening of the curve in the last few months was a sign of stress in cre...