FX.co ★ German 10-Year Bund Yield Falls Further

Germany’s 10-year Bund yield fell below 2.75%, its lowest level since early December, marking a seventh straight session of declines as investors moved into safe-haven assets and assessed the likelihood of another ECB rate cut later this year. The Bund rally has largely tracked broader moves in global bond markets. In the US, 10-year Treasury yields declined after softer-than-expected inflation data on Friday and ongoing concerns about potential disruption linked to artificial intelligence. In Japan, government bond yields continued to retreat following Prime Minister Sanae Takaichi’s decisive election victory earlier this month. In the UK, weaker labour market data bolstered expectations that the Bank of England will deliver further rate cuts this year. Within the euro area, evolving expectations for ECB policy have also pushed yields lower, with markets currently assigning roughly a 40% probability to one additional rate reduction before year-end. Investors are now looking to Wednesday’s release of the Federal Reserve’s minutes for additional insight into the monetary policy outlook.