Market Outlook: European Bond Yields on the Rise

Forex - As traders digest the comments from European Central Bank President Christine Lagarde, the Euro is losing value against the strengthening dollar, while European bond yields are rising. In an interview with the Financial Times, Lagarde stated that the central bank is "very close" to achieving the sustainable inflation target of 2%, but expressed a "slight concern" due to persistently high service inflation. MUFG Bank analyst Derek Halpenny noted in a report that there is a "cautious element" in Lagarde's remarks. Halpenny emphasized that despite the Eurozone being affected by U.S. trade tariffs, significant wage growth could support consumption and the services sector. The Euro fell by 0.2% to $1.0407. The 10-year Bund yield rose by 3.4 basis points to 2.318%.