“There are basically two reasons for this,” Jan Randolph, director of IHS Markit sovereign risk rating, told CNBC Tuesday about the recent fall in yields. Bond yields move inversely to prices.
“Greece has been performing better than to plan, with the fiscal adjustment stronger than expected … This together with some resumption of modest growth is expected to turn debt dynamics positive; with many rating agencies (including IHS Markit) moving Greece’s sovereign ratings slowly away from a possible default scenario.”
He added: “Secondly, Greece has secured another bailout program extension in June, with IMF involvement despite difference with other euro zone partners on the nature and degree of debt relief.”
Last June, the euro zone agreed to disburse a tranche of 8.5 billion euros ($9.2 billion) which allows the country to comply with summer payments. The Greek debt agency wasn’t available for comment when contacted by CNBC.