Eurozone Bond Yields Climb on Rising Oil Prices and Inflation Fears

European government bond yields rose on Monday as investors reacted to rising oil prices and uncertainty over the US-Iran conflict, keeping inflation concerns in focus ahead of key economic data this week.

The benchmark 10-year German government bond yield was last up slightly at 3.6303%, its highest level since June 2009, after recording a seventh consecutive weekly increase.

The European Central Bank has already raised interest rates twice this year to combat inflation, and investors are now pricing in at least one further increase by year-end.

Oil prices rose again after US President Donald Trump rejected an Iranian proposal over the weekend aimed at reopening the Strait of Hormuz and ending the fighting.

Brent crude futures were last around 2% higher at $106.46 a barrel, with higher energy prices contributing to government bond yields rising globally in recent months.