German 2-year bond yield hits 4-month high after strong US inflation

The German 2-year bond yield, which is sensitive to European Central Bank interest rate expectations, hit its highest level since November on Thursday after March U.S. inflation data came in stronger than expected the previous day. ** Germany's 2-year bond yield hit 2.995% in early trading after rising 7 basis points (bps) following the U.S. data on Wednesday.

The German 2-year bond yield, which is sensitive to European Central Bank interest rate expectations, hit its highest level since November on Thursday after March U.S. inflation data came in stronger than expected the previous day.

** Germany's 2-year bond yield hit 2.995% in early trading after rising 7 basis points (bps) following the U.S. data on Wednesday. It was last up 2 bps at 2.976%. ** The European Central Bank sets interest rates later in the day and is widely expected to leave them at 4%. Traders will be on the lookout for signs of whether the ECB still thinks a June cut is likely, as officials have previously suggested. ** The U.S. consumer price index rose 0.4% in March after climbing the same amount in February, defying economists' expectations of a fall to 0.3%. Year-on-year, inflation stood at 3.5%, up from 3.2% the previous month. ** The figures cast doubts on whether the Federal Reserve will be able to cut rates this summer, and by extension caused investors to temper their expectations for rate cuts from other central banks. ** Germany's 10-year bond yield was up 2 bps at 2.447%, after rising 6 bps on Wednesday. ** The Italian 10-year bond yield was 2 bps higher at 3.793%. The closely watched gap between Italian and German 10-year borrowing costs stood at 133 bps.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)