Euro zone bonds steady after safe-haven rally, French debt set for best week since August
TLT•Euro zone government bond yields steadied Friday but were set for a weekly decline, while French 10-year yields were down 7 basis points for the week. Money markets priced a 100% chance of an ECB rate hike in December, and the IMF expected one more hike this year.
1. Bond yields fall for week
Euro zone government bond yields steadied Friday but remained on track for a weekly decline after a safe-haven rally fueled by concerns about AI-related companies’ ability to deliver returns on their spending. German 10-year Bund yields were around 3.42%, down nearly 7 basis points for the week, while global G7 sovereign yields fell an average of 8.7 basis points to 4.273%, according to LSEG data.
2. French debt stabilises
French 10-year yields traded around 4.79%, flat on the day and down 7 basis points for the week, their largest weekly decline since early August. The premium over German Bunds was about 137 basis points, down from nearly 160 basis points on October 2. Money markets priced a 100% chance of an ECB rate hike in December, while the IMF forecast one more hike this year.
