Eurozone Bond Yields Fell Before ECB’s Meeting
Eurozone bond yields fell in anticipation of the ECB’s meeting. Most of the Eurozone government bond yields were 1-2 basis points lower. The yield of 10-year bonds of Germany fell by 1 bps to 0.55%.
Markets expect the ECB to leave its quantitative easing program (QE) unchanged. Data this week confirmed that inflation in the Eurozone remains at 1.3% - well below the ECB's target of 2%. The euro has significantly strengthened against the US dollar and is trading at the highest level since May 2016.
It is awaited, that the European Central Bank’s chief Mario Draghi will use Thursday’s meeting to calm market expectations of a scaling back of stimulus in coming months.