FX.co ★ Bund Yields Hold Near September Highs on Strong Eurozone Data

Germany's Bund yield has plateaued at approximately 2.75%, a peak last seen on September 25. This stabilization follows an upward revision of November's Eurozone Composite PMI and inflation figures slightly above expectations, reinforcing the belief that the European Central Bank (ECB) is not likely to reduce interest rates in the near term. Earlier this week, yields saw a sharp increase, mirroring rises in U.S. and Japanese government bond yields after Bank of Japan Governor Ueda hinted potential rate hikes might be considered later in the month. The HCOB Eurozone Composite PMI was adjusted to 52.8 from an initial estimate of 52.4, marking the most robust expansion of the private sector since May 2023. Meanwhile, Eurostat reported that Eurozone inflation rose to 2.2% in November, edging out forecasts of 2.1%. Together with recent minutes from the ECB indicating a lack of immediate intent to loosen monetary policy, the market's expectations have remained largely steady, with investors generally projecting no interest rate adjustments until 2026.