A decision by Moody’s to upgrade the country’s credit rating by one notch to B1 on Friday, combined with mass purchases of Greek state bonds by the European Central Bank in the framework of its PEPP program, led Greek state bond yields to new record lows in the domestic electronic secondary bond market on Monday. The 10-year bond yield fell to 0.73 pct from 0.80 pct on Friday, while the five-year bond yield fell to negative territory (-0.005 pct), the first time that a medium-term bond yield fell below zero. Greece’s credit rating is still three notches below the investment grade. Moody’s attributed this upgrade to continuing reforms promoted by the Greek government and to the growth prospects of the Greek economy.
