Euro-Area Yields Decline to Record Lows on Fed Rate Bets

Borrowing costs across the euro area dropped to record lows amid speculation sluggish global growth will prompt the Federal Reserve to keep interest rates near zero for longer than previously forecast.

Yields on 10-year government bonds from Spain to Finland, including German securities, fell to all-time lows after minutes of U.S. policy makers’ most recent meeting said a slowdown and a stronger dollar posed potential risks to the outlook for the world’s largest economy. A gauge of inflation expectations in the euro area dropped to the least on record as European Central Bank President Mario Draghi said officials will lift inflation in the 18-nation currency bloc.