“It is an urgent and immediate priority to reinforce international market confidence in our ability and commitment to restore our banking system to health and to secure the long-term sustainability of our fiscal position.” [Brian Lenihan, 30/09/10]
Below is a graph attempting to chart ‘the market’s’ reaction to government policy over the last 3 years. If anyone has access to the raw data used to create the bond yield graph (GIGB10YR:IND) please send it our way.
Charting government policy vs market reaction [click image to zoom]
What happened today? What was all the noise about government bonds, spreads, cats in bins. This is what happened:
The graph shows the 10-year bond yield for Irish government bonds (essentially the cost of borrowing), which looks fairly dramatic, until you look at the same data over a longer time frame, in this case the last 3 years:
Data provided by Bloomberg.