LONDON – Euro zone bond yields were little changed on Tuesday, with the focus of global markets on the Bank of Japan, which ended eight years of negative interest rates.
Germany’s 10-year bond yield, the benchmark for the euro zone, was last up less than 1 basis point (bp) at 2.462%.
The 10-year yield has risen over the past week as U.S. economic data has come in stronger than expected, causing investors to rein in bets on Federal Reserve rate cuts.
Germany’s 2-year bond yield was also up less than 1 bp at 2.923%.
The BOJ set the overnight call rate as its new policy rate and decided to guide it in a range of 0-0.1%. Its key rate previously stood at -0.1%.
Analysts told Reuters that rates would most likely have to rise further before Japanese investors started pulling out of foreign bond markets to return cash home.
