Bund Yields at Highest Since October 2023

2025-12-22 09:54 By Joana Ferreira 1 min. read

Germany’s 10-year Bund yield held near 2.9%, its highest level since October 2023, supported by the European Central Bank’s hawkish stance and expectations of increased fiscal spending in Germany.

Last week, the ECB left interest rates unchanged for a fourth consecutive meeting and signaled that borrowing costs are likely to remain at current levels for some time, noting that the eurozone has weathered US tariffs better than anticipated.

Stronger-than-anticipated economic data also prompted the ECB to raise its growth outlook, now projecting eurozone GDP at 1.4% in 2025, up from 1.2%.

Looking ahead, Germany’s fiscal plans are adding further upward pressure on yields.

Lawmakers approved a €524 billion federal budget for 2026, including nearly €180 billion in borrowing, with increased defense and infrastructure spending, enabled by the lifting of the debt brake, set to provide additional economic stimulus.



News Stream
Eurozone Bond Yields Ease as Energy Prices Cool
Eurozone government bonds snapped a six-day losing streak on Thursday, pushing yields down from multi-year highs as easing energy prices helped alleviate inflation concerns and led markets to marginally scale back expectations for European Central Bank rate hikes. Germany’s 10-year Bund yield eased to 3.36%, just below Wednesday’s 15-year high of 3.3951%, as Brent crude retreated from six-week highs and natural gas prices fell from their highest level since January 2023. The declines came after US President Donald Trump said the renewed US military campaign in Iran would not last long. Bond yields nevertheless remain elevated amid concerns over energy-driven inflation, higher interest rates and fiscal sustainability in countries including France and the UK. Money markets continue to fully price in a 25-basis-point ECB rate hike to 2.5% next week. Markets are also pricing in an almost 100% probability of a 3% deposit rate by June 2027, implying two further rate increases by mid-2027.
2026-09-03
Bund Yields Hit 2011 High as ECB Hike Bets Strengthen
Germany’s 10-year Bund yield extended its recent rise to 3.4% on Wednesday, its highest level since April 2011, as rising oil prices fueled inflation concerns and boosted rate-hike bets. Brent crude hit fresh six-week highs, as traders weighed persistent Middle East supply risks against signs that crude was still reaching the market. Eurozone inflation data released earlier this week showed price growth at its highest level in nearly three years, strengthening expectations for further ECB tightening. Money markets now price in almost a 100% chance of a rate hike next week, with a strong probability of another increase by year-end. ECB policymakers Olli Rehn and Martin Kocher warned that prolonged conflict and rising inflation risks could warrant further tightening. In the US, markets are pricing in a 66% probability of a September rate hike, following hawkish remarks from Fed Chair Kevin Warsh and this week’s rise in oil prices.
2026-09-02
Germany 10Y Bond Yield Hits 15-year High
Germany 10 Year Government Bond Yield increased to 3.38%, the highest since April 2011. Over the past 4 weeks, Germany 10Y Bond Yield gained 22.74 basis points, and in the last 12 months, it increased 63.87 basis points.
2026-09-02