Global Bond Yields Surge Amid Trade Negotiations and Economic Shifts
Germany's bond yields reached six-week highs amid the European focus on borrowing and spending, as trade talks between the EU and the U.S. continued. With increased European issuance and Japan's ascending yield trends, market dynamics were keenly observed with potential borrowing influx anticipated.
Germany's bond yields hit six-week highs Tuesday, driven by European borrowing and spending focus while absent new U.S. tariffs on the EU. The rise follows European bond auctions and pressure from Japanese yields, with Germany's 10-year yield at its highest since May at 2.66%.
The U.S. trade policy remains in focus, influencing market sentiment. President Trump warned of higher tariffs for Japan and South Korea from August 1, while the EU discusses trade deals post a positive meeting between European Commission President Ursula von der Leyen and Trump.
Germany plans increased defense and infrastructure spending, expected to raise longer-dated yields. Tuesday saw significant European bond issuance, underscoring debt supply's role in yield movements, while Japanese election anticipation further influenced bond market behavior.
(With inputs from agencies.)
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