Euro Zone Bond Yields Dip as Investors Eye Inflation Data

Euro zone government bond yields experienced a decrease on Thursday, reversing the minor rise seen the previous day, as investors focused on forthcoming inflation data from Europe and the United States. The yield on Germany's 10-year bond fell slightly by just over 1 basis point to 2.68%.

The drop in European bonds was partially influenced by a marginal decline in Japanese yields, following a policy statement from the Bank of Japan, which extended market participants' expectations for a future rate hike. National inflation numbers from the euro zone kicked off with France showing a slightly higher-than-expected rise in consumer prices for July.

Despite euro zone-wide inflation hovering near the European Central Bank's 2% target, the ECB appears to be maintaining its stance, rendering euro zone inflation less critical for traders compared to elsewhere. The U.S. PCE inflation data, set for release at 1230 GMT, holds more significance for the market.

(With inputs from agencies.)