The Bundesbank said that the German government today sold 4.18 billion euros of two-year notes on an average yield of 0.29% a new record low and ironic to the record high yield Italy paid at the auction today of 5-year notes of 6.47%.

The demand though was not a disappointing this time opposed to the last auction that failed to draw investors attention and forced the Bundesbank to step in due to the low yields compared with the rising risk on Germany as the debt crisis spreads and deepens where this auction the bid-to-cover ratio was 1.4 times.