Spanish bonds fell for a second day as Cyprus’s banks reopened for the first time in almost two weeks amid concern fallout from its financial turmoil will spread to Europe’s other high debt and deficit nations.

Spain’s 10-year yields climbed to the highest level in three weeks after Cyprus’s Finance Ministry said controls on bank withdrawals and overseas transfers will be in force for seven days to limit capital flight. Portuguese and Irish bonds also dropped. German 10-year yields fell to the lowest in almost eight months after unemployment in Europe’s largest economy unexpectedly increased, underpinning demand for safer assets.

“The way EU officials approached the crisis in Cyprus is having spillover to other peripheral countries,” said Alessandro Giansanti, a senior rates strategist at ING Groep NV in Amsterdam. “It becomes now highly likely that in every future bailout there will be a private-sector involvement.”

Spain’s 10-year yield rose three basis points, or 0.03 percentage point, to 5.11 percent at 11:18 a.m. London time after rising to 5.15 percent, the highest level since March 4. The 5.4 percent bond maturing in January 2023 dropped 0.23, or 2.30 euros per 1,000-euro face amount, to 102.205.

Ireland’s 10-year yield climbed two basis points to 4.28 percent and Portugal’s rose seven basis points to 6.44 percent.

Cypriot banks had been shut since March 16 when the European Union presented a plan to force losses on depositors in exchange for a 10 billion-euro ($12.8 billion) bailout. They will close at 6 p.m. local time, Yiangos Dimitriou, head of the central bank’s audit department, said yesterday in comments broadcast on state-run CyBC television.

German Bunds

German 10-year bunds rose for a second day as the Federal Labor Agency said the number of people out of work increased a seasonally adjusted 13,000 in March to 2.94 million. Economists predicted a decline of 2,000, according to a Bloomberg survey.

A separate report showed German retail sales, adjusted for inflation and seasonal swings, rose 0.4 percent in February from a month earlier.

Germany’s 10-year yield fell one basis point to 1.26 percent after declining to 1.25 percent, the lowest level since Aug. 3. The yield has dropped 12 basis points this week.

Italian bonds rose, with 10-year yields falling two basis points to 4.76 percent after climbing as much as eight basis points to 4.86 percent.

Volatility on Irish bonds was the highest in euro-area markets today followed by those of Belgium and France, according to measures of 10-year debt, the yield spread between two- and 10-year securities, and credit-default swaps.

German bunds returned 0.5 percent this year through yesterday, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. Italy’s bonds declined 0.3 percent and Spain’s gained 2.9 percent.