Euro Zone Bond Yields Rise Amid Economic Data Anticipation

Euro zone government bond yields increased slightly as investors turned attention to upcoming economic data following the Federal Reserve policy meeting outcome. This movement reflects investor optimism regarding rate cuts and inflation control. German and French bond yields experienced slight fluctuations, with key inflation data releases anticipated in the coming weeks.

Euro zone government bond yields edged higher on Friday as investors refocused on upcoming economic data, following the Federal Reserve policy meeting outcome.

Risk-sensitive assets saw gains as investors expected further rate cuts and viewed the Fed as nearing victory over inflation, while also steering the U.S. economy towards a soft landing. As usual, yields moved inversely to bond prices.

German 10-year yields rose 0.5 basis points to 2.20%, finishing the week 4.5 bps higher. 'After days of speculation about whether the Fed would deliver a 25 bps or 50 bps cut, the market can now concentrate on macro fundamentals,' stated Rohan Khanna, head of euro rate strategy at Barclays. Upcoming September flash PMIs on Monday will serve as a critical indicator of the region's economic momentum, influencing overall market sentiment.

(With inputs from agencies.)