2025.09.1113:46:33UTC+00German Yields Rise as ECB Holds Rates

Germany’s 10-year bond yield edged closer to 2.7% following the European Central Bank's decision to maintain interest rates and reveal updated forecasts for growth and inflation. This outcome, anticipated by many, reflects the balancing act policymakers face amid robust economic conditions, historically low unemployment, ongoing inflation, and uncertainties in trade policies. The ECB's current projections suggest that the eurozone's GDP will grow by 1.2% in 2025, up from 0.9% forecasted in June, then slow to a 1.0% growth rate in 2026, and stabilize at 1.3% by 2027. Meanwhile, inflation expectations have been slightly revised upward, with projections for headline inflation at 2.1% in 2025 (previously 2.0%), 1.7% in 2026 (increased from 1.6%), and 1.9% for 2027 (adjusted from 2.0%). Meanwhile, in the United States, a notable increase in jobless claims coupled with a rise in annual inflation to 2.9% has bolstered the belief that the Federal Reserve might decrease rates later in the year.