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Euro zone bond yields tick up after ECB rate hike and Trump's Iran comments
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Euro zone bond yields tick up after ECB rate hike and Trump's Iran comments
Jun 11, 2026 6:11 AM

June 11 (Reuters) - Euro zone bond yields rose slightly on

Thursday, but remained lower on the day, after European Central

Bank policymakers raised interest rates and signalled the

outlook for growth and inflation was uncertain.

Germany's 2-year yields, which is sensitive to

expectations for policy rates, were last very slightly lower on

the day at 2.701%, from 2.673% before the decision.

However, a statement from U.S. President Donald Trump that

the U.S. will be hitting Iran "very hard" on Thursday night also

pushed yields higher just after the ECB decision.

Yields were lower before the meeting, with oil prices

falling slightly as traders monitored the latest headlines on

U.S.-Iran peace talks.

The ECB raised interest rates to 2.25%, from 2%, saying:

"The war in the Middle East is generating inflation pressures,

and the decision to raise rates is robust across a range of

scenarios mapping out how the shock might evolve."

It added: "The outlook remains uncertain, with upside risks

for inflation and downside risks for economic growth."

The ECB is keen to stamp out any danger that inflation will

pick up pace after it struggled to contain rising costs in the

wake of Russia's invasion of Ukraine in 2022.

Euro zone inflation rose to 3.2% in May, its highest since

September 2023, as energy costs surged.

Traders were last pricing in around 45 bps of further hikes

this year, little changed from before the decision. They will

now look to ECB President Christine Lagarde's press conference

for further clues about the outlook.

Germany's 10-year government bond yield, the

euro area's benchmark, was last down 1 bp at 3.056%, from around

3.04% before the decision. Yields move inversely to prices.

It reached 3.20% in mid-May, its highest level since May

2011, before signs of an economic slowdown driven by the Iran

war helped pull yields lower.

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