Euro Zone Yields Dip but Head for Fourth Straight Weekly Rise

European bond yields dropped slightly on Friday but are still set to rise for the fourth consecutive week due to rising energy prices and resilient economic growth. Germany's 10-year bond yield, which is inversely related to price, fell by 2 basis points (bps) to 3.334%. However, the benchmark euro zone yield, which tracks a broader range of bonds, is still expected to rise by 6 bps this week after hitting its highest level since 2011.

The global bond selloff has been driven by concerns about inflation and high government borrowing. In the US, data showed that the economy added 162,000 jobs in August, far exceeding economists' predictions of a 56,000 increase. This led to an increase in US Treasury yields, although the impact on European markets was muted.

Investors are also monitoring natural gas and oil prices, which are set to rise for the week due to renewed tensions between the US and Iran. The increased risk of supply disruptions has pushed European bond yields higher.