European Bond Markets Mixed Ahead of Policy Decisions
European government bonds traded mixed, with Germany’s 10-year Bund yield easing to 3.34%, near its lowest level since early September, as renewed concerns over a prolonged Middle East conflict boosted safe-haven demand. Meanwhile, borrowing costs in France and Italy rose as investors took profits following sharp declines on Monday. French 10-year yields fell around 11 basis points on Monday after Moody’s affirmed the country’s sovereign credit rating. Weekend protests also passed without the widespread unrest seen the previous week, easing immediate concerns over domestic instability. Investors now await policy decisions from the European Central Bank and the US Federal Reserve. Both central banks are widely expected to keep interest rates unchanged this week, leaving markets focused on their forward guidance for clues about the future path of monetary policy.
European government bonds traded mixed, with Germany’s 10-year Bund yield easing to 3.34%, near its lowest level since early September, as renewed concerns over a prolonged Middle East conflict boosted safe-haven demand. Meanwhile, borrowing costs in France and Italy rose as investors took profits following sharp declines on Monday. French 10-year yields fell around 11 basis points on Monday after Moody’s affirmed the country’s sovereign credit rating. Weekend protests also passed without the widespread unrest seen the previous week, easing immediate concerns over domestic instability.
Investors now await policy decisions from the European Central Bank and the US Federal Reserve. Both central banks are widely expected to keep interest rates unchanged this week, leaving markets focused on their forward guidance for clues about the future path of monetary policy.