Bund Yields Hit 3% on Oil Surge

2026-07-08 07:40 By Joana Ferreira 1 min. read

Germany’s 10-year Bund yield rose above 3%, reaching its highest level since June 10, as oil prices climbed to two-week highs following renewed strikes between the US and Iran.

The escalation heightened inflation concerns and strengthened expectations that the ECB will keep interest rates elevated for longer.

US President Trump further escalated tensions by stating that, as far as he is concerned, the Iran ceasefire is over.

Traders are now pricing in more than 30 bps of additional ECB tightening this year, signaling at least one potential rate hike, possibly as early as September.

On Monday, Germany’s cabinet approved a 2027 budget draft, outlining €555.4 billion in spending and increasing borrowing to €203.6 billion, up from earlier estimates.

In France, far-right leader Marine Le Pen announced she intends to run in the 2027 presidential election, with polls currently favoring her National Rally, while uncertainty persists over who will emerge as President Macron’s successor.



News Stream
Bund Yields Hit 3% on Oil Surge
Germany’s 10-year Bund yield rose above 3%, reaching its highest level since June 10, as oil prices climbed to two-week highs following renewed strikes between the US and Iran. The escalation heightened inflation concerns and strengthened expectations that the ECB will keep interest rates elevated for longer. US President Trump further escalated tensions by stating that, as far as he is concerned, the Iran ceasefire is over. Traders are now pricing in more than 30 bps of additional ECB tightening this year, signaling at least one potential rate hike, possibly as early as September. On Monday, Germany’s cabinet approved a 2027 budget draft, outlining €555.4 billion in spending and increasing borrowing to €203.6 billion, up from earlier estimates. In France, far-right leader Marine Le Pen announced she intends to run in the 2027 presidential election, with polls currently favoring her National Rally, while uncertainty persists over who will emerge as President Macron’s successor.
2026-07-08
Bund Yields Rise as Oil Surges, ECB Hike Bets Rise
Germany’s 10-year Bund yield approached 2.98%, its highest since June 19, as crude oil prices climbed following attacks in the Strait of Hormuz. The tensions pushed crude above $73 per barrel, its highest since early July, fueling inflation concerns. Traders increased bets on ECB rate hikes, with official Isabel Schnabel warning that the Iran conflict’s economic impact persists, as core inflation remains strong. Meanwhile, Germany’s cabinet approved a 2027 budget draft on Monday, planning €555.4 billion in spending and raising borrowing to €203.6 billion, up from April’s €196.5 billion estimate. In France, far-right leader Marine Le Pen was cleared to run in the 2027 presidential election despite a sentence requiring one year of electronic monitoring, which she says could force her to withdraw. Polls still show the National Rally as the frontrunner, while the centrist camp has yet to unite behind a clear successor to Emmanuel Macron.
2026-07-07
Bund Yield Steady After Last Week's Rise
Germany’s 10-year Bund yield remained steady at 2.92%, after rising 8 basis points last week, influenced by higher Japanese yields and a focus on long-term borrowing. Germany’s cabinet approved the first draft of the 2027 budget on Monday, with planned spending of €555.4 billion next year, and total borrowing rising to €203.6 billion, compared to the €196.5 billion signaled in April. Despite these changes, the 10-year Bund yield remains well below the multi-year high of 3.2% reached in May, when the Strait of Hormuz was effectively closed and oil prices surged, which could force the ECB to hike rates significantly despite slowing growth. Markets now see one more 25-basis-point ECB hike this year as likely, following softer inflation and dovish remarks from ECB President Christine Lagarde about a more balanced outlook for euro-area inflation and growth. Meanwhile, a weaker-than-expected US jobs report further reduced expectations for a near-term Federal Reserve rate hike.
2026-07-06