2026.09.2308:26:38UTC+00Bund Yield Steady as Markets Reassess ECB Rate Outlook

Germany’s 10-year Bund yield hovered around 3.45% as declining oil prices led traders to pare back expectations of further ECB rate hikes, even as investors weighed stronger-than-expected PMI figures. Brent crude retreated on signs of progress in renewed US-Iran negotiations and efforts to restore a key Saudi Arabian pipeline.

ECB official Joachim Nagel noted that oil prices are playing an increasingly important role in monetary policy decisions and kept the option of additional rate hikes open, citing persistently elevated core inflation. He also stressed that he had not yet observed any significant second-round inflation effects. By contrast, ECB Chief Economist Philip Lane cautioned that another spike in energy prices could keep eurozone inflation higher for longer than currently anticipated.

At the same time, flash PMI data showed eurozone private-sector activity expanding in September at its fastest pace in nearly three and a half years. In the US, investors raised their expectations for further Federal Reserve rate increases after a series of hawkish remarks from policymakers.