LONDON Oct 17 German Bund futures fell on
Wednesday after Moody's decision to keep Spain's investment
grade rating cooled demand for safe-haven government bonds.
Spain's government dodged a bullet on Tuesday when Moody's
Investors Service affirmed its Baa3 rating, with a negative
outlook, assuaging widespread fears that the country would be
cut to a junk rating.
German Bund future fell 23 ticks to 140.54,
extending the previous day's losses, when the contract saw its
biggest one day fall in more than a week.
Moody's decision should provide a favorable backdrop to an
auction of Spanish government bonds on Thursday by removing an
immediate threat to the euro zone's fourth largest economy.
"Maybe Spain gets a bid but they still have got supply
tomorrow," one trader said. "It will probably go OK. "