Euro Zone Bond Yields Spike to Multi-Year Highs Amid Inflation Fears
European government bond yields have reached fresh multi-year highs as investors await key inflation data. The benchmark for the euro zone, Germany's 10-year yield, rose over 1 basis point to 3.34%, its highest in 15 years. Super-long 30-year yields also surged nearly 2 bps to 3.83%, a level not seen since 2011.
The global bond selloff is attributed to rising energy costs due to the Iran conflict, sparking fears of broader price increases and prompting central banks to hike interest rates. Additionally, the market is under pressure from a surge in bond issuance as tech companies aggressively raise funds for artificial intelligence projects, competing with government bonds for investor attention.
In Europe, investors are closely watching flash inflation data due at 0900 GMT on Tuesday. National data from major economies suggests that the euro-zone-wide figure may offer some relief, although German inflation rose in August due to higher energy prices.