German bond yields on course for biggest weekly rise in a decade

 

German government bond yields jumped on Thursday as a rout in euro zone markets worsened, putting them on course for their biggest weekly rise in over a decade.

Yields on 10-year German bonds — the bloc’s benchmark — rose as much as 20 basis points to hit 0.799 percent, their biggest daily rise since the middle of 2012.

As of 0930 GMT, yields were up some 38 basis points on the week, set for their biggest rise seen since at least 2004, according to Tradeweb data.

Other euro zone government bond yields rose 4-15 bps.

Strategists said the market capitulation which started last week was sparked by easing deflation fears and investor weariness with ultra-low yields.

“It’s a historical move that we’re experiencing – a continuation of the move we’ve seen in the past few days,” said Jean Francois Robin, head of strategy at Natixis. “The macro picture is getting better in Europe.”

 

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