21.08.202509:18:53UTC+00German 10-Year Bund Yield Edges Up after Strong PMI Data

Germany's 10-year bond yield has risen to 2.734% following stronger-than-anticipated PMI data, indicating that the Euro Area's private sector is experiencing its fastest growth in 15 months. The composite PMI increased to 51.1 in August, exceeding predictions, with manufacturing seeing its first expansion since June 2022. Notably, Germany’s manufacturing sector is nearing the end of a three-year downturn, reflecting Europe's steadfastness despite ongoing trade tensions and geopolitical uncertainties. This positive data strengthens the argument of ECB officials who are cautious about hastily implementing further rate cuts after eight reductions since 2024, despite markets still anticipating a 45% probability of another cut by the year's end. ECB President Christine Lagarde remarked that the new 15% US tariff on EU goods was higher than baseline forecasts, though not as severe as worst-case scenarios. Meanwhile, focus now turns to Federal Reserve Chair Jerome Powell's upcoming address at the Jackson Hole summit. In the UK, inflation remained high at 3.8% in July, diminishing the likelihood of additional easing by the Bank of England.