FX.co ★ Bund Yields Climb as Investors Flee US Assets on Tariff Uncertainty

The yield on Germany's 10-year Bund is approaching 2.55% as investors shift focus away from U.S. assets due to escalating trade policy uncertainties. This shift follows President Donald Trump's recent suggestion of doubling tariffs on steel and aluminum imports. Heightened tension between Washington and Beijing is further straining markets, with both governments accusing each other of violating a recent tariff ceasefire. In anticipation of significant economic events, such as the European Central Bank's policy meeting on Thursday and U.S. payroll data release on Friday, market participants are repositioning their strategies. The ECB is anticipated to reduce interest rates by an additional 25 basis points. However, the market's attention will also focus on the ECB's forward guidance, particularly in light of some officials advocating for a pause in further monetary easing. Their concern centers on evaluating the implications of U.S. tariffs on inflation and economic growth.