Interest Rate Market
In 2018 the returns on Treasury bonds in the 2-year sector dropped by 45 b.p. to 1.35%, in the 5-year sector by 30 b.p. to 2.29%, and in the 10-year sector by 47 b.p. to 2.83%. Such a significant increase in the debt market was caused mainly by significant easing of the Monetary Policy Council’s policy, supported by a significant drop in inflation.
Concerns about the weakening condition of the global economy led to a drop in returns on bonds on base markets, i.e. the US market and the Euro Area, which indirectly supported the domestic market.