The cost of borrowing for crisis hit countries in the eurozone is tumbling amid expectations that the European Central Bank will be forced to start buying government bonds to fend off the spectre of a damaging period of deflation. Yields on 10-year Portuguese government bonds, which move inversely with prices, dropped below 4 per cent for the first time since early 2010 on Friday while Spanish 10-year yields tumbled to a near decade-low. Fears that the eurozone is drifting towards a Japanese-style bout of deflation were stoked further on Friday after prices fell in Spain this month and inflation edged down in Germany. The unexpected dip in Spanish prices capped a week that saw yields on peripheral countries’ debt tumble and the euro edge lower after Germany’s powerful central bank radically scaled back its opposition to the possibility of the ECB embarking on a government bond buying programme. […]