Spanish and German government bonds are signaling the respite in the euro-region's debt crisis created by the European Central Bank's unlimited three-year loans is coming to an end.

Two weeks after Italian Prime Minister Mario Monti said the "flames of crisis" are unlikely to return, German bund yields have fallen to records and Spanish borrowing costs have surged to the highest since the ECB started its longer-term refinancing operations in December. Spanish 10-year yields rose above 6 percent this week, getting closer to the 7 percent level that triggered the bailouts of Greece, Ireland and Portugal, as Prime Minister Mariano Rajoy said the country's future is on the line.

"The positive effect of LTRO operations is now well on the wane," said Lyn Graham-Taylor, a fixed-income strategist at Rabobank International in London. "We are well and truly back in crisis mode."