Latest news with #Bunds
Business Recorder
5 days ago
- Business
- Business Recorder
Euro zone bond yields touch April high after EU gets 30% tariff
LONDON: German 10-year government bond yields briefly hit their highest since early April on Monday after U.S. President Donald Trump said on Saturday he would impose a 30% tariff on most imports from the European Union from August 1. In an escalation of a trade war that has angered U.S. allies and rattled investors, Trump announced his latest tariffs in separate letters to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum that were posted on his Truth Social media site on Saturday. Benchmark Bund yields rose to as much as 2.733% in early trading, their highest since April 1, a day before Trump's original 'Liberation Day' tariff reveal. They retreated to hold steady on Friday's close at 2.726%. Thirty-year yields traded around 3.236%, up around 1 basis point on the day and within sight of their highest since mid-March. 'The latest tariff threats of 30% on EU goods are above the upper end of the recently discussed ranges, but with negotiations still progressing until the 1 August deadline, any risk-off and subsequent support for Bunds looks set to be limited at best,' Commerzbank rates strategist Hauke Siemssen said. Euro zone bond yields inch higher as traders await tariff news 'After all, Trump has repeatedly threatened substantial tariffs but extended deadlines in the subsequent days. The threats over the weekend can therefore probably be considered well in line with Trump's usual playbook,' he said. For its part, the EU has already prepared a list of tariffs worth 21 billion euros ($24.5 billion) on U.S. goods if the two countries fail to reach a trade deal, Italian Foreign Minister Antonio Tajani said in a newspaper interview on Monday. French 10-year bond yields edged up to 3.417%, while 30-year yields rose 1.5 bps to 4.216%, after President Emmanuel Macron on Sunday announced a plan to push forward defence spending, pledging to double the military budget by 2027, three years earlier than originally planned. His government is already struggling to make 40 billion euros in savings in its 2026 budget.
Bloomberg
30-06-2025
- Business
- Bloomberg
European Markets Are Becoming Increasingly Difficult to Ignore
European stocks outperformed their US peers by the biggest margin on record in dollar terms during the first half, the most dramatic sign of how the region's markets are staging a comeback after more than a decade in the doldrums. The rebound isn't confined to stocks: the euro is up 13% against the dollar in the six months through June. Meanwhile, the chaotic rollout of US tariffs wiped some of the shine off Treasuries. German bunds have outperformed them since April even as the government braces to issue more debt. Assets in emerging European markets like Poland and Hungary are also rallying sharply.
Mint
20-06-2025
- Business
- Mint
Euro area yields drop, Italian spread set for biggest weekly rise since June 2024
June 20 (Reuters) - Euro zone government bond yields were on track for a weekly decline as the Israel-Iran air war entered its eighth day, with investors downplaying inflation concerns while awaiting clarity on potential U.S. involvement in the conflict. President Donald Trump will decide on Iran in the next two weeks, while Germany and its European partners are open to further discussions. German 10-year government bond yields, which serve as the benchmark for the wider euro zone, fell 0.5 basis points (bps) to 2.51% and were set to end the week 2.5 bps lower. Several analysts expect a relatively tight trading range for Bunds, barring any fresh shocks, while noting that the current rise in oil prices is insufficient to boost inflation. "The bearish risks to (euro area) core rates are relatively tame, in our view. The German fiscal U-turn is likely to have a persistent impact on long-term forwards, but that is already well priced," said Jamie Searle, strategist at Citi, arguing he is neutral on Bunds at 2.5% with a preference to buy the dips. Germany announced in early March a massive increase in fiscal spending to fund infrastructure and defence investments. "On the bullish side, it feels like the market may have become complacent on tariff risk once again," Citi's Searle added, also mentioning possible support is the potential for reallocation to euro from the U.S. dollar with Bunds a likely beneficiary as the safest asset. Money markets priced in a European Central Bank deposit facility rate at 1.77% in December from 1.75% last week. It priced a depo rate at around 1.6% in early April when concerns about the economic impact of U.S. tariffs led investors to discount a dovish response from the ECB. "I believe there is a growing recognition that the European Union can play a larger role, especially if it develops a more comprehensive fiscal union rather than just a monetary union," said Kristina Hooper, chief market strategist at Man Group. "There will be a willingness among investors to shift at least somewhat to euro-area bonds, primarily German bunds." The yield on German 2-year bonds – more sensitive to expectations for the ECB policy rates -- was flat at 1.84%. A decline in risk appetite widened the yield spreads between government bonds of highly indebted countries—such as Italy and France—and safe-haven German Bunds. Italy's 10-year yields dropped 0.5 bps to 3.54%. The Italian yield gap versus Bunds — a market gauge of the risk premium investors demand to hold Italian debt — was at 102.5 bps on Friday but was still set to end the week 10.8 bps wider, the largest increase since June 2024. The French yield gap was set for the third straight weekly rise and was last 73.50 bps, after hitting early in the session 75.30 bps, its highest since April 23. In France, the business climate index for June was at 96, below the long-term average and consensus expectations. (Reporting by Stefano Rebaudo, Editing by Andrew Cawthorne)
Business Times
17-06-2025
- Business
- Business Times
Eurozone yields edge up amid uncertainty over outcome of Middle East conflict
[BRUSSELS] Eurozone government bond yields edged up on Tuesday (Jun 17) with high levels of uncertainty surrounding the possible outcome of the conflict in the Middle East. Investors were also awaiting the result of the Federal Reserve policy meeting later this week. US President Donald Trump said he wanted a 'real end' to the nuclear problem with Iran and indicated he might send senior American officials to meet with Iranian counterparts as the Israel-Iran air war raged for a fifth straight day. German 10-year yields, which serve as the benchmark for the euro area, rose one basis point (bp) to 2.54 per cent. Two-year Schatz yields were up one bp at 1.85 per cent. 'This looks like a minor regional shock, while the way the conflict is resolved will have a significant impact,' said Philippe Waechter, chief economist at Ostrum AM. He recalled there was no significant impact on long-term interest rates in the United States or Europe. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'And investors, unsure of which direction it will take, are in a wait-and-see position,' he said. Waechter added that the oil price had not exceeded its level at the beginning of this year, recalling media reports suggesting that Saudi Arabia could increase its oil supply. The world oil market appears well-supplied this year in the absence of a major disruption, the International Energy Agency said on Tuesday. Brent crude futures rose more than 1.5 per cent, after dropping sharply the day before. Markets slightly reduced their bets on the European Central Bank easing cycle, pricing in an ECB deposit facility rate at 1.78 per cent in December from 1.75 per cent last week. German investor morale rose more than expected in June, the ZEW Economic Research Institute said on Tuesday. Fed policymakers will begin a two-day meeting on Tuesday amid risks of a new commodity price shock and fresh US data expected to show a drop in retail sales and sluggish factory output in May. In an opinion piece in the Financial Times, ECB President Christine Lagarde cited a 'global euro moment' at this time, but said a step toward greater international prominence for the currency must be earned, mentioning several challenges the European Union faced. Italian bonds slightly underperformed Bunds, with yields on the 10-year rising 2.5 bps to 3.51 per cent. The yield gap versus Bunds was at 96 bps; it hit 84.20 bps last week, its lowest since March 2015. REUTERS
Yahoo
12-06-2025
- Business
- Yahoo
German 10-Year Bund Yield to Struggle to Fall Below 2.5%
Bunds may lose steam without a catalyst for the 10-year Bund yield to trade consistently below 2.5% and due to some anxiety over the 30-year Treasury auction due later.
