ECB stimulus package

Spain bond yields hit record low

Spain bond yields hit record low
Mario Draghi, President of the European Central Bank, ECB addresses the media during a press conference Frankfurt on January 22, 2015. Photo: Daniel Roland/AFP
The yield on 10-year Spanish government bonds fell to record lows on Thursday after the European Central Bank announced it was setting out on a massive bond buying programme.

At 1400 GMT the rate of return to investors on benchmark Spanish 10-year bonds hit a record low of 1.450 percent, down from 1.530 percent the night before.

Meanwhile the yield on Italian 10-year bonds hit a record of 1.609 percent, down from 1.691 percent on Wednesday.

The news came after the ECB announced a €1.1 trillion ($1.3 trillion) bond buying programme.

The ECB announced that it will buy €60 billion of European debt every month from March 2015 until September 2016.

"The combined monthly purchases of public and private sector securities will amount to €60 billion" ECB head Mario Draghi told assembled journalists at a press conference in Frankfurt.

The bond-buying programme will continue "until we see a sustained adjustment in the path of inflation which is consistent with our aim of achieving inflation rates below, but close to, 2%", he added.

The Euro immediately dropped sharply against the US dollar on the news.