LONDON (Reuters) – Euro zone bond yields were trading at their highest level in a month on Monday morning as investors continued to try to gauge the prospects of central banks cutting rates in 2025.
Last week, the US Federal Reserve (Fed) put upward pressure on US government bond yields after hinting at a slower pace of monetary easing.
In Europe, the President of the European Central Bank (ECB) Christine Lagarde told the Financial Times on Monday that the institution was on the verge of achieving its inflation target in the euro zone.
The yield on German 10-year bonds, the benchmark for the euro zone, rose 3 basis points (bps) to 2.32% on Monday, around its highest level since November 22.
The yield on two-year German bonds, more sensitive to ECB rate forecasts, increased by 1.7 bp to 2.056%.
The yield on 10-year French bonds rose by 4.2 bp to 3.128%, their highest level since mid-November.
The Italian 10-year yield rose 5 bps to 3.50%, and the spread between Italy and Germany widened 1.7 bps to 118 bps.
Transaction volumes are lower as the holiday season approaches.
(Writing by Harry Robertson and Bertrand De Meyer, editing by Kate Entringer)
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