2026.11.1308:59:08UTC+00Bund Yields Climb to Two-Week High

Germany’s 10-year Bund yield climbed toward 3.4%, its highest level since late October, as investors ramped up bets on additional European Central Bank interest rate hikes and this week’s rebound in equity markets curtailed demand for safe-haven assets. ECB euro short-term rate (€STR) forwards now suggest markets expect the deposit rate to rise from the current 2.5% to 3.25% by late 2027, up from 3% priced in just a week earlier. They also imply a rate of 2.74% by December 2026.

At the same time, stronger-than-expected US inflation data released on Tuesday pushed Treasury yields higher and reinforced expectations of further tightening by the Federal Reserve. Markets are now fully pricing in a rate increase by December, with the possibility of a larger 50-basis-point move also under consideration. Adding to inflation concerns, oil prices rebounded from more than two-month lows after US President Donald Trump said on Thursday that Washington did not need a deal with Iran.