This paper investigates and models the yield spreads of sovereign debt of Eurozone countries by means of macroeconomic … fundamentals. In particular, this paper shows that the change in the volatility of terms-of-trade of trade outside the Eurozone was … terms-of-trade in this manner for the Eurozone, and presents important findings for fixed income investors …

related to a more fundamentally economic reality: structural heterogeneity among the Eurozone countries which was aggravated … specialization among Eurozone countries that, contrary to the expectations of public policy designers, resulted in an increased … sample of eight countries: the four largest economies in the Eurozone, Germany, France, Italy and Spain; and four smaller …