Safe Haven Surge: German Bond Yields Dip to Three-Month Low Amid Global Tensions

German government bond yields descended to their lowest levels in more than three months on Friday, following heightened investor interest in secure assets after Israel's extensive strikes on Iran. The 10-year Bund yield dipped by 4 basis points to 2.44%, hitting a low of 2.422%, the lowest observed since March 3. Meanwhile, 2-year Schatz yields reduced by 1.5 basis points to 1.80%.

Long-duration bonds, particularly the 30-year German debt, exhibited significant performance, declining by 4.5 basis points to 2.91%, contributing to a flatter yield curve. The week's trend indicated the steepest decline since late March, with an overall drop of 13 basis points.

In the euro zone, rising bond prices resulted in lower yields, consistent with the upward momentum in gold and the U.S. dollar. French 10-year yields decreased by 2.4 basis points to 3.162%, whereas Italian 10-year yields, although dropping 1.5 basis points to 3.40%, reached their lowest since December at 3.398%. Sweden, meanwhile, plans to auction new debt.

(With inputs from agencies.)