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Updated · Bloomberg · Jul 8German 10-Year Yields Top 3% as Middle East Fighting Lifts Oil
3 articles · Updated · Bloomberg · Jul 8Summary
- German 10-year bond yields rose four basis points to 3.03%, crossing 3% for the first time in nearly a month as bunds sold off.
- Higher oil prices from a flare-up in Middle East fighting rekindled inflation fears, pushing investors to demand higher yields.
- Two-year German yields, which are more sensitive to monetary-policy expectations, jumped as much as six basis points to 2.65%.
- The move signals that geopolitical shocks are again feeding quickly into euro-area rate expectations through the energy and inflation channel.
Insights
As central banks hike rates against a supply shock, will they trigger a global recession before taming inflation? With the Strait of Hormuz choked, what are Europe's real options to escape this crippling energy crisis? How is the five-month Middle East war permanently reshaping global trade beyond the immediate oil price shock?