Investors fled to the safety of government bonds on Wednesday, sending yields to historic lows, as fresh evidence of a severe downturn in the US economy sparked swings in stock markets.

The yield on 10-year US Treasuries, which moves inversely to their price, sank below 3 per cent to its lowest level for 50 years. Analysts attributed the decline to the Federal Reserve’s measures to push short and long term interest rates lower.