Yield Gap Between U.S., German Debt Is Widest Since 2006: Chart

(Bloomberg) -- The extra yield that investors demand to own two-year Treasuries instead of similar-maturity German government debt reached about 1.5 percentage points, the widest since 2006, according to data compiled by Bloomberg. The gap swelled after a report showing U.S. service companies rebounded last month led traders to increase wagers that the Federal Reserve will raise interest rates by year-end. U.S. two-year Treasury yields touched about 0.85 percent Wednesday, the highest since June, while their German counterparts yielded about minus 0.68 percent.

To contact the reporter on this story: Yun Li in New York at yli934@bloomberg.net.

To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net, Mark Tannenbaum, Sophie Caronello