The German 10-year Bund yield fell to 2.28%, its lowest level in nearly four weeks, as investors sought safety amid escalating geopolitical tensions and dovish signals from ECB officials.
German 10-year Bund yield falls
President Vladimir Putin pushed forward with a pledge to expand Russia’s nuclear doctrine, allowing for nuclear strikes in response to a large-scale conventional attack, including drone strikes, and treating aggression from a non-nuclear state supported by a nuclear power as a joint attack. Meanwhile, ECB Vice-President Luis de Guindos and Bundesbank President Joachim Nagel highlighted the growth risks posed by US trade tariffs, overshadowing concerns about inflation.
Focus on ECB's moves
The ECB has cut rates three times since June as inflation nears the 2% target, but growth projections have been revised down twice. Markets now anticipate a 25-basis-point rate cut next month, with a 20% chance of a larger 50-basis-point move. Investors are also focused on upcoming wage data for the euro area on Wednesday and PMI figures on Friday.
