Rates Spark: Euro Rates in the Shadow of US-Driven Global Sentiment
Trade tensions are testing risk sentiment, leading to lower US and euro rates. The 10Y US Treasury yields have fallen below 4% again, with moderate spillovers to euro rates.
A broader global risk-off episode would likely force 10Y rates to explore lower ranges, with high demand for Bunds as one of the last remaining AAA havens, according to Senior European Rates Strategist.
Trade tensions are benefiting US Treasuries, with the 10Y UST yield dipping below 4% intraday again as investors seek safety.
Euro rates are largely driven by US rates, with domestic drivers offering no novel insights, except for occasional French headlines with negligible spillovers outside of French government bonds.
Author's summary: Euro rates are influenced by US-driven global sentiment.