Euro Zone Bonds Surge Amid U.S. Job Data Anticipation

Euro zone bond yields dropped as investors awaited the U.S. employment report. Recent data indicated a slowing U.S. economy, with job openings, private payroll growth, and manufacturing activity all declining. German industrial orders also fell. Investors are closely watching the U.S. non-farm payrolls report, expected to influence global markets substantially.

Euro zone government bond yields declined for the fourth straight day on Friday as investors awaited the newest monthly U.S. employment report. Recent data pointed to a decelerating U.S. economy, with drops in job openings, private payroll growth, and manufacturing activity.

The pivotal release for markets remains the upcoming U.S. non-farm payrolls report, due at 8:30 a.m. ET. Germany's benchmark 10-year bond yield decreased by 5 basis points to 2.162%, its lowest since the beginning of August when weak U.S. jobs data triggered a stock-market sell-off and a rally in bonds.

Italy's 10-year yield similarly fell to its lowest since December at 3.517%. Additionally, German industrial orders saw a sharper-than-expected decline in July. The European Central Bank meets next week and is anticipated to adjust key rates, further affected by the upcoming U.S. payroll data.

(With inputs from agencies.)