German 10-year bund yields are up 4 bps to 0.41%
It seems like ECB members are trying to get their thoughts in before the blackout period tomorrow, and earlier we had comments from Praet, Hansson (newspaper interview), and Weidmann. They all touched on inflation and the key takeaway was that they seem to be convinced that inflation is moving towards the ECB's inflation target of just under 2%.
The upbeat comments sets the tone for next week's policy meeting on 14 June where it looks very likely the central bank will announce the end to its QE programme.Those expectations are now being filtered into the euro but it is also giving a lift to bond yields in the region. German 10-year yields are up by 4 bps on the day while we're also seeing a rise in French, Italian, and Spanish yields too.
However, the rise in Italian yields owes a bit to mixed sentiment with the partial rise also reflecting some hints of nervousness with regards to the domestic situation in the country. Italy's 10-year yields are up by 16 bps on the day as the yields spread between Germany and Italy 10-year bonds now widens to above 250 bps.
