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Treasury yields diverge from German Bund yields

FXStreet (Mumbai) - The yields on the short duration and long duration treasury yields in the US rose on Monday, contradicting the weakness seen in the German bond yields.

The 10-year yield in the US rose 3.1 basis points to 1.881%, while the 10-year yield in Germany is trading moderately weak 0.076%. Moreover, the German benchmark yield hit a low of 0.0419% on Friday, while the 10-year yield in the US rose after the data in the US showed an uptick in the core inflation in March.

Meanwhile, the uncertainty in Greece has German Bunds outdo Treasuries as favored safe haven assets, since they make up the biggest component of the ECB’s 1.1 trillion euro ($1.2 trillion) regional bond-buying program launched in the last month.

Markets pricing in a Fed lift-off at October – BAML

Priya Misra, Strategist at BofA-Merrill Lynch, comments that markets have priced out much of Fed hikes in 2015 due to poor economic data and a seemingly dovish Fed.
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