German Bonds Surge Amid Global Tariff Tensions

German bonds rose sharply as investors sought safety ahead of U.S. President Trump's anticipated tariff announcements. Global markets fell, and the yen rose as uncertainty loomed. Germany's 10-year bond yield declined, reflecting concerns over the trade negotiations and euro zone inflation. The ECB may consider further interest rate cuts.

German bonds saw a significant rally on Monday, reducing benchmark yields to their lowest in nearly a month, as investors turned to government debt for safety ahead of an anticipated announcement from U.S. President Donald Trump regarding tariffs. Analysts suggest these tariffs could reshape the global trading system.

During early trading, Germany's 10-year bond yield, a critical benchmark for the euro zone, fell to 2.659%, its lowest since early March, indicating a flight to safer investments amid tariff-related uncertainty. Economic experts have noted the lack of clarity on potential tariffs and counter-measures creates a negative outlook for markets.

Inflation data revealed a larger-than-expected drop in German inflation rates, supporting calls for further rate cuts by the European Central Bank. Meanwhile, the U.S.-imposed tariffs and Europe's response are projected to reduce eurozone growth. Political tensions rose as French far-right leader Marine Le Pen faced a five-year ban from public office following a conviction.

(With inputs from agencies.)