Eurozone Bond Yields: A Surge Amid Fiscal Uncertainty

Eurozone bond yields have surged, marking significant monthly increases due to sustained pressure on long-term debt in developed economies. Investors are wary of high government debt levels, causing Germany's 30-year yield to approach its highest since 2011, with a 12-basis point increase this month, paralleling March's shift towards looser fiscal policies.

In France, bond yields rose by 27 basis points, their largest monthly ascent since March. This comes amid political turmoil as Prime Minister Francois Bayrou faces a confidence vote. Analysts predict Bayrou's potential loss, which could leave France without a prime minister or national budget for the third time in a year.

Despite rising yields, ECB-sensitive two-year yields remain stable, and investor attention now turns to U.S. PCE data. This gauge, preferred by the Federal Reserve, might influence European markets, where a significant chance of a rate cut is currently anticipated.

(With inputs from agencies.)