June 14 (Reuters) - The cost of insuring against European junk bond defaults fell to its lowest level since February 2020 on Monday.
The spread on IHS Markit's iTraxx Europe Crossover index, which measures the cost of insuring against defaults on a basket of underlying sub-investment grade bonds, fell to 229 basis points. That is the lowest since late February 2020, before pandemic concerns weighed on financial markets.
Credit markets have rallied sharply in recent sessions, alongside government bonds, which have been supported by short covering and a dovish outcome to last week's European Central Bank meeting.
(Reporting by Yoruk Bahceli, editing by Karin Strohecker)