Bonds: Key interest rate falls, bond interest rate rises

Euro Bund future under pressure

"The indication that monetary policy is now well positioned to deal with global uncertainty has dashed expectations of interest rate cuts," explains Ralf Umlauf of Helaba. The yield on ten-year German government bonds rose from 2.48 percent to just under 2.60 percent within three hours. As of Friday afternoon, it stood at 2.55 percent, up from 2.53 percent a week ago. Rising yields put pressure on the Euro Bund future. The September contract fell to a low of 130.12 points on Thursday, but subsequently recovered slightly to its current level of 130.70 points. According to Umlauf, the 55-day average at 130.13 points offers support, before the May lows of 129.30 and 128.97 points could become more prominent among market participants.