financetom
World
financetom
/
World
/
Euro zone bond yields dip as traders assess interest rate outlook
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Euro zone bond yields dip as traders assess interest rate outlook
Apr 17, 2024 8:46 AM

LONDON, April 17 (Reuters) - Euro zone bond yields fell

slightly on Wednesday after climbing to a 1-1/2-month high the

previous day, as traders assessed central banks' possible next

moves following robust U.S. data.

This week's fall in demand for safe assets pushed bond

yields higher, while surprisingly strong U.S. retail data on

Monday caused investors to further trim bets on Federal Reserve

rate cuts this year, and by extension causing a slight reduction

in European Central Bank (ECB) rate cut pricing.

Germany's 10-year bond yield, the benchmark for

the euro zone, was last 2 basis point (bp) lower on the day at

2.465%, after hitting the highest level since late February on

Tuesday. It has risen since Friday's tumble to 2.318% when

investors snapped up safe assets as tensions between Israel and

Iran ratcheted higher. Yields move inversely to prices.

On Tuesday, top U.S. central bank officials, including

Federal Reserve Chair Jerome Powell, backed away from providing

guidance on when interest rates may be cut and said monetary

policy needed to be restrictive for longer.

On the same day, ECB President Christine Lagarde said the

bank would cut rates soon, barring any major surprises, and

argued the impact of geopolitical events on commodity prices had

not been very significant so far.

"European data remains on the weak side, the disinflation

trend is still intact in Europe and ECB is set to cut rates in

June," said Mohit Kumar, chief Europe economist at Jefferies.

Longer-dated yields fell slightly in the afternoon session.

Emmanouil Karimalis, European rates strategist at UBS, said the

market is keeping an eye on oil prices and their inflation

implications.

Oil has risen to around its highest since October on

the back of Middle East tensions and an uptick in global growth,

but was down around 0.9% on Wednesday.

Italy's 10-year bond yield was last 4 bps lower

at 3.874%, after rising to its highest level since March 1 on

Tuesday.

The German 2-year bond yield, most sensitive to

expectations for policy rates, was last 1 bp higher at 2.942%,

after briefly rising to an almost one-week high.

Analysts said investors will be watching for a slew of

central banks speakers due later in the day, including Lagarde

and Bank of England Governor Andrew Bailey.

Data on Wednesday confirmed euro zone inflation slowed

across the board last month, reinforcing expectations for a ECB

interest rate cut in June, even as rising energy costs and a

weak euro currency cloud the outlook.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
MORNING BID ASIA-The waiting game ahead of Fed, BOJ
MORNING BID ASIA-The waiting game ahead of Fed, BOJ
Jul 29, 2024
July 30 (Reuters) - A look at the day ahead in Asian markets. Stocks around the world on Monday continued from where they left off on Friday, stemming the tide of last week's selling as investors squared positions ahead of a wave of market-moving economic data, policy decisions and earnings reports later in the week. There doesn't appear to be...
Morning bid: The waiting game ahead of Fed, BOJ
Morning bid: The waiting game ahead of Fed, BOJ
Jul 29, 2024
(Reuters) - A look at the day ahead in Asian markets. Stocks around the world on Monday continued from where they left off on Friday, stemming the tide of last week's selling as investors squared positions ahead of a wave of market-moving economic data, policy decisions and earnings reports later in the week. There doesn't appear to be much on...
CANADA STOCKS-Canada's TSX slightly down as investors gear up for earnings, Fed move
CANADA STOCKS-Canada's TSX slightly down as investors gear up for earnings, Fed move
Jul 29, 2024
* TSX down 0.15%, several triggers seen this week * Week has three major monetary policy decisions * Host of heavyweight earnings from U.S., Canada (Updates with market close data, comments) By Promit Mukherjee and Shubham Batra July 29 (Reuters) - Canada's main stock index edged lower on Monday ahead of a busy earnings week and a raft of central...
GLOBAL MARKETS-Oil slips, Asia stocks dip ahead of Fed, BOJ
GLOBAL MARKETS-Oil slips, Asia stocks dip ahead of Fed, BOJ
Jul 29, 2024
SINGAPORE, July 30 (Reuters) - Oil traded near seven-week lows on Tuesday as a softening demand outlook weighed on commodities, while bond, currency and stock markets traded cautiously ahead of central bank meetings in the U.S. and Japan and a slew of major corporate earnings reports. Brent crude futures hit $79.36 overnight as traders focused on worries over Chinese demand...
Copyright 2023-2026 - www.financetom.com All Rights Reserved