Euro Zone Bond Yields Rise Amid Data Awaits

Euro zone government bonds experienced slight gains on Monday, as the conspicuous absence of headlines concerning US tariffs shifted investor attention to forthcoming economic data releases later in the week.

The yield on Germany’s benchmark 10-year bond increased by nearly 2 basis points, reaching 2.49%. However, it remained near the lower boundary of its recent trading range.

US economic data will be closely monitored, with the release of PCE inflation and GDP figures scheduled for Wednesday, followed by the nonfarm payrolls report for April on Friday.

Market participants will scrutinize these figures for indications of the potential economic repercussions resulting from trade tariffs-induced disruptions and uncertainties, although the impact may not be immediately apparent in this week’s data.

European Inflation Data in Focus

Across Europe, upcoming inflation reports will be unveiled, starting with Spain on Tuesday, followed by Germany, France, and Italy on Wednesday.

An unexpectedly high inflation reading could prompt investors to reassess their expectations regarding the European Central Bank’s (ECB) potential continuation of interest rate cuts aimed at bolstering the European economy. Nevertheless, barring any significant surprises, the primary focus is expected to remain on the US economic data.

The yield on Italy’s 10-year bond remained steady at 3.59%, while Germany’s rate-sensitive two-year yield edged up by 1 basis point to 1.75%.