German Bond Yields Soar on ECB Tightening Bets
German government bond yields are set for their fourth consecutive weekly rise as investors bet on further European Central Bank (ECB) tightening. This week's increase would be the biggest since mid-July, according to Reuters.
The 10-year German government bond yield rose by 0.5 basis points to 3.36% and is on course for a weekly increase of 7.5 basis points. The two-year German bond yield climbed by 1 basis point to 2.96%, putting it on track for its steepest weekly rise since mid-July.
The rise in yields reflects market reassessment of inflation and interest rates across the euro zone. A survey cited by Reuters showed that growth in the bloc's manufacturing sector accelerated to its fastest pace in more than four years in August, while inflation moved back above 3% due to higher energy costs.