He said the weighted average of seven to ten year sovereign yields in the 12 eurozone markets was at its highest level since 2008, having surged by 100 basis points since early September.
Comparatively, Ward said year-to-date EMU bond prices were down 5.5% and barring a late recovery were set to put in their worst annual performance since 1999 when seven to ten year bunds plunged 9.6%.
Back then the poor performance was off the back of monetary tightening at the hands of the newly-created ECB towards the tail-end of the tech boom.
The current dire situation among eurozone bonds, shown by the 7.9% drop in the EMU-12 seven to ten year bond price index since early September, warrants a further cut in the ECB interest rate and eurozone wide QE, according to Ward.
ECB quantitative easing
He said any QE should be country-neutral, with purchases spread across national markets in proportion to GDP or population, which would emphasise the commitment of the eurozone members to finding a solution and counter criticism of a back door fiscal bailout.
John Ventre, portfolio manager at Skandia Investment Group said quantitative easing from the ECB could be closer than many think.
Following the sell off of German Bunds in the past couple of days, he said Germany’s anti-QE stance might be eroded.
"Ultimately, Germany suffers from the same problem all of the other eurozone states have – there is no buyer of last resort. The ECB needs to fulfil this role and so far it is only the Germans that have blocked this development.
"Pressure on German bunds might change this dynamic," Ventre said.
Ward concluded that claims such a policy would amount to inflationary money-printing should be met head on, as the ECB is essentially already conducting QE via its Securities Markets Programme and through covered bond purchases.
