Euro zone bond selloff pauses as gas prices ease

Euro zone government bonds were set on Thursday to snap a six-day falling streak, pushing yields away from multi-year highs as benchmark gas prices eased, alleviating some inflation worries.

Bond yields have surged in recent weeks on heightened worries about energy-induced inflation and rising interest rates, along with anxiety about fiscal sustainability in some countries, including France, the United States, Japan and the UK.

Germany's 10-year Bund yield DE10YT=RR, the benchmark for the euro zone, was down 1 basis point at 3.365%, just below the 15-year high of 3.3951% reached on Wednesday.

"(Bonds) are still trading with energy prices," said Anders Svendsen, chief analyst at Nordea.

Front-month European benchmark natural gas prices closed at their highest level since January 2023 on Wednesday, but were slightly lower on Thursday after U.S. President Donald Trump said the renewed military campaign in Iran would not last long.