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Spanish, Portuguese benchmark bond yields hover just above 0%

 It highlights a stunning turnaround from the euro-area crisis

Less than a decade ago, investors could barely be compensated enough to hold the bonds of Spain and Portugal for fear the nations could be severed from the European Union. 

Now, they are a hair’s breadth away from having to pay for the privilege.

Before the global financial crisis, Spain was growing healthily and might have benefited from higher interest rates; Germany was growing more weakly. 

As one monetary policy had to fit all, Spain benefited from low rates aimed at Germany, and enjoyed an epic construction boom that would inflict a severe and enduring recession once the bubble burst.

John Authers Bloomberg 19 augusti 2019

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