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Following ECB minutes, euro zone bond yields increase


Euro zone bond yields rose on Thursday after the European Central Bank’s March meeting minutes were more hawkish than expected. The European Central Bank policymaker said he appeared keen to scale back stimulus at the March 10 meeting and, judging by his résumé shown at the meeting on Thursday, the conditions for a rate hike were met. claim to be satisfied or to be satisfied. Policymakers at the conference agreed to end asset purchases during the third quarter without committing to roll back stimulus, although a significant number of groups went further, citing a certainty of purchases.

These bets also increased slightly after a minute. “Many members appear to want immediate monetary policy normalization, and the ECB appears to be emphasizing its fight against inflation,” said Rene Albrecht, rates strategist at DZ Bank. Referring to a statement by Fed President Nagel, Albrecht said, “The market thinks the normalization process could go faster than expected because the Fed president said interest rates needed to go higher” said.

I wanted to set an end date. Eurozone bond yields were low before the meeting, but reversed and rose after the announcement. By 1210 GMT, the block’s benchmark German 10-year yield rose four basis points to 0.69%, the highest in more than a week. The rate-expectation-sensitive 2-year yield rose 4 basis points to 0.01%. Analysts had expected little impact from the minutes as the market had already priced in a 60 basis point ECB rate hike by the end of the year.

The focus was also on the reopening of 2032 and 2072 bonds, and the French government bond auction, which raised €11,499 million from new 2038 bonds. Demand for the amount raised was similar to previous auctions for the same 10- and 50-year bonds. “The results are fairly average and reasonable given the circumstances and risk events we face,” said Peter McCallum, an interest rate strategist at Mizuho Securities in London.

“There could have been merchants who wanted to add to their inventory if customers wanted to buy at a later date, perhaps after the election,” he added. He began to accept the possibility of winning the election against incumbent Emmanuel Macron. That pushed France’s benchmark 10-year yield to its highest level since 2015 earlier this week, with the bond underperforming its peers in the block. Spain also raised €5.57 billion from auctions of bonds maturing in 2027, 2029, 2032 and inflation-linked bonds maturing in 2033.

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  • Following ECB minutes, euro zone bond yields increase
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