Euro zone bond yields are showing an increase, while market participants are preparing for the announcement of the results of the Fed meeting. Meanwhile, tensions over Ukraine have held back further bond sales.
As for the Fed meeting, investors are concerned about the consequences of excessive tightening of financial conditions, and therefore Fed Chairman Powell is likely to act cautiously so as not to cause a sharp drop in markets, analysts at Commerzbank said, and added that the Fed may announce an immediate end to asset purchases or possibly further discussions of earlier/faster quantitative tightening (QT) and a faster rate hike this year.
The yield on 10-year German government bonds rose by 0.8 basis points to -0.073%. Meanwhile, the yield on Italy's 10-year government bonds fell by 0.1 basis points to 1.359%.
Analysts warn of a potential increase in the risk premium in Italy if Prime Minister Mario Draghi assumes the presidency and leaves his current position.