Even in this respect, the signalling effect of Greece’s inclusion in the APP will be strong enough for GGB prices to recover accompanied by a significant fall in volatility, as the overall financial environment is normalised and Greece ceases to be the outlier in the euro area.
It is worth simply reminding the sharp fall in the government bond spreads of peripheral euro area countries (Italy, Spain) vis-à-vis the yields of core euro area country bonds, when the ECB announced the OMT programme and their convergence after the OMT final approval from the European Court of Justice. 3.