Global Bonds Rise as ECB Purchase Pledge Backs Low-Yield World

Global sovereign bonds rallied after the European Central Bank expanded its debt-buying program, shrinking the supply of securities and reinforcing policy rates at virtually zero.

Yields declined from Germany to Spain after ECB President Mario Draghi committed to buying up to $1.3 trillion of bonds, including government debt, to revive economic growth and ward off deflation. The Bank of America Merrill Lynch Global Broad Market Sovereign Plus Index had an effective yield of 1.16 percent as of yesterday, close to the record 1.14 percent reached Jan. 19, the lowest based on data starting in 1996.