Euro zone yields set for third daily rise, bets wane on ECB cuts
LONDON, July 25 (Reuters) - Euro zone government bonds headed for a third daily rise on Friday, as investors lost some conviction in the European Central Bank cutting interest rates much further, while growing chances of a U.S. trade deal drew cash out of safe haven assets.
The ECB left interest rates at 2% on Thursday, as expected, and President Christine Lagarde suggested policymakers were less concerned about an abrupt slowdown in growth and inflation over the coming year.
Bond yields rose sharply in response.
Two-year German Schatz yields DE2YT=RR, which rose by nearly 12 basis points on Thursday in their biggest one-day increase since mid-May, were up 2.3 bps at 1.934%.
Benchmark 10-year German DE10YT=RR yields were up 3.3 bps to 2.726%, while Italian yields IT10YT=RR rose nearly 5 bps to 3.613%, leaving the gap between the two at 88.4 bps, its highest in a week.
Money markets show traders are undecided about another ECB rate cut this year, attaching about a 30% chance of a drop below 2% by the end of December.
Related Articles
Netflix After the Warner Deal: What Investors Should Know
TradingKey - For quite some time now, Netflix (NFLX) has been regarded as the premier subscription-based streaming service in the world, with a well-established history of growth through creative use of pricing power, developing hit programming, and relying very little on outside sources for licensi
Warsh’s Fed Era Signals a Death Knell for QE, Jolting the $30 Trillion Treasury Market
With Warsh’s nomination, his past proposals for governing the Federal Reserve are being brought to the forefront. A central issue is the formulation of a new "1951 Accord" to restructure the relationship between the Fed and the Treasury. Analysts suggest such a move could impact the $30 trillion Tre
Amazon Stock Predictions for 2026 to 2030: Will They Exceed Expectations and Achieve Major Long-Term Goals?
TradingKey - As we head into 2026, many investors are questioning where Amazon (AMZN) fits into the technology world.
A Crash After a Surge: Why Silver Lost 40% in a Week?
TradingKey - Spot silver (XAGUSD) prices continue to decline. Silver plunged 20% on Thursday, breaking below $71 per ounce, with the sell-off intensifying on Friday as prices fell further below $64. Compared to the all-time high set on January 29, silver prices have retraced more than 40%, wiping out nearly all gains accumulated over the previous month.
