Bloomberg Probes Spanish Bond Benchmark Error

Financial data provider Bloomberg LP Tuesday said it is investigating the cause of an error which led it to switch its benchmark 10-year Spanish bond, a move that caused confusion in currency markets.

The change to using a bond maturing in January 2024 instead of the previous January 2022 benchmark prompted a flurry of media reports that Spanish 10-year government bond yields had surged back above 6%, a rise of around 0.3 percentage points from Monday's close.

Bloomberg said the change was made in error and has been reversed. The company, which competes with Dow Jones Newswires as a news and data provider, said it had notified all its clients of the mistake.

"We're investigating the root cause of the issue," a Bloomberg spokeswoman said.

Traders at Citigroup said confusion over the correct benchmarks contributed to a 0.5% slide in the euro against the dollar in early European trading. "Some systems have been showing the wrong Bund/Bono spread and were spooked when the "old" spread moved out by apparently more than 30 basis points," the bank said in a note to clients.

A Spanish Treasury spokesman confirmed that the country had not changed its benchmark bond. Several government bond traders contacted by Dow Jones Newswires, and the data provider Tradeweb, said they were still using the 2022 bond as the benchmark, while moves in secondary market trading were muted.

At 0925 GMT the yield on the 2022 bond was up 4 basis points at 5.73%, according to Tradeweb.

(Art Patnaude in Madrid contributed to this article.)

Write to Tommy Stubbington at [e-mail]

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