The ECB raised interest rates to a record high of 4% on Sept. 14. The Federal Reserve held interest rates at 5.25% to 5.5% on Wednesday, followed by the Bank of England holding rates at 5.25% on Thursday. Policymakers overriding message was that interest rates would remain at high levels until inflation was clearly heading back down to 2% and was likely to stay there
FRANKFURT, May 5 ― Euro zone bond yields edged up today as equity markets recovered from a sudden slump a day earlier that had sent yields on the safe-haven assets falling sharply. Stock markets fell 0.5 per cent yesterday in a matter of minutes and further afterwards, leaving traders perplexed.
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POOL/The Associated Press
The European Central Bank is “closely monitoring” the recent rise in government bond yields, ECB President Christine Lagarde said on Monday, the clearest sign yet that policymakers are becoming uncomfortable with the recent surge in borrowing costs.
Euro zone bond yields have risen sharply since the start of the year, mirroring a similar move in U.S. Treasuries, but the ECB has so far played down these moves, arguing that nominal yields are not necessarily an appropriate benchmark.