Germany 10Y Bond Yield Hits 39-Week High

2025-12-18 14:01 By Agna Gabriel 1 min. read

Germany’s 10-year Bund yield breathly climbed to 2.89%, the highest since March 2025, after the ECB kept rates unchanged for a fourth straight meeting and reinforced the view that no immediate policy response is needed.

New ECB forecasts pointed to firmer economic growth and inflation returning to the 2% target by 2028 after undershooting in the next two years.

While many officials see the inflation dip as temporary, markets have begun pricing out further easing and are even considering a first ECB rate hike as early as 2026.

Adding upward pressure on yields, investors are becoming increasingly concerned about Germany’s fiscal sustainability.

In November, German lawmakers passed the 2026 federal budget, marking a shift away from the long-standing “black zero” balanced-budget policy, with the government set to raise a record €512 billion in bond issuance next year to fund infrastructure upgrades and military spending.



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