Euro Zone 10Y Yield Falls to 3.46%

Euro Zone 10Y Yield Falls to 3.46%

Euro zone government bond yields declined on Tuesday, with Germany’s benchmark 10‑year yield slipping 1 basis point to 3.46% after reaching a session low of 3.426% earlier in the day. The two‑year German yield remained roughly unchanged at 3.125%. Bond market volatility has eased after a sharp sell‑off in late September and early October that had pushed the German 10‑year yield to 3.65%, its highest level since 2009.

The move into safety was driven by a broad sell‑off in technology equities. South Korea’s tech‑heavy KOSPI index fell more than 5%, while Nasdaq 100 futures dropped 0.7%.

In the United States, the benchmark 10‑year Treasury yield fell 3 basis points to 5.22%. Across the euro area, France’s 10‑year yield declined 6 basis points to 4.84%, and Italy’s 10‑year yield slipped 3 basis points to 4.55%.

Market participants do not expect the Federal Reserve to raise interest rates this month, and upcoming economic data releases are seen as the final key inputs before the central bank’s next policy decision.

French government bonds have been under pressure as investors anticipate political activity ahead of next year’s presidential election, which could complicate the government’s efforts to reduce its fiscal deficit.