April 11 (Reuters) - Euro zone bond yields were stable
on Friday after a turbulent week as worries about the global
economy and U.S.-China trade conflict gripped markets despite a
temporary pause in some of U.S. President Donald Trump's broader
tariffs.
Investors' nervousness has resulted in heavy selling of U.S.
bonds and the dollar, which has pushed the premium that holders
of Treasuries demand to hold U.S. debt rather than German Bunds
up by the most in a week since the 1990s.
The German 10-year bond yield, the benchmark for
the euro zone bloc, edged up 0.7 basis points to 2.59%.
Germany's bond market sat out a global selloff on Wednesday,
which saw U.S. yields rise dramatically and the gap between the
German and U.S. 10-year yields widen.
On Friday, selling in U.S. bonds resumed, with the 10-year
note yield rising to 4.427% and the spread between
German and U.S. 10-year Treasuries widening to 182
bps, having risen by over 40 bps in this week alone, its largest
such increase in at least 30 years, according to LSEG data.
Bunds have only risen by 3 bps this week, as investors have
flocked to safe havens beyond the U.S. market, particularly in
light of the aggressive selloff in Treasuries.
Italy's 10-year yield was higher by 1.7 basis
points at 3.82%. The gap between Italian and German 10-year
bunds, a gauge of the premium that investors
demand to hold Italian debt, widened to 122 bps.
Germany's two-year bond yield, which is more
sensitive to European Central Bank rate expectations, was 1.6
bps lower at 1.8%.
German inflation eased to 2.3% in March, the federal
statistics office said on Friday, confirming preliminary data.