AMSTERDAM, April 21 Reuters Euro zone bond yields were broadly steady on Wednesday as investors appeared to refrain from placing big bets ahead of the European Central Bank monetary policy meeting on Thursday, but risk aversion provided some underlying support to debt markets.
Rising coronavirus cases and the fall in the oil price cast doubt on the strength of global economic growth and dampened risk appetite across global markets on Wednesday, underpinning appetite for safehaven government bonds.
Investor focus also turned to Thursdays ECB meeting, where the central bank is largely expected to keep policy on hold, while investors are looking for clarity on how it will react to Europes economic recovery from the pandemic.
Data on Tuesday showed the central banks bond buying under its pandemic emergency bond programme, before accounting for redemptions, reached its highest since June 2020 last week, according to Refinitiv IFR.
Rates markets remain very much caught between the rock of improving macroeconomic conditions and the treacherous waters of geopolitical risks and alarming COVID19 case growth in some corners of the world, ING analysts said.
As a result, this morning interest rates are back where they started the week after significant gyrations in recent days.
German 10year yields, the benchmark for the euro area, were unchanged at 0.26 at 0722 GMT, below the 0.215 level touched on Tuesday, which was the highest since late February.
Germanys 10year Bund…