Decline in Countries’ Inflation Data Point to Lower Eurozone Bond Yields

0625 GMT – Inflation shifts back into market focus with indications about sticky core inflation likely overshadowing initial relief caused by declining headline figures, Hauke Siemssen, rates strategist at Commerzbank, says in a note. “Today’s national inflation releases for March should take center stage and provide pointers for tomorrow’s important euro-area HICP figure,” he says. Inflation releases are due in Germany, Spain, Italy, Ireland and Belgium, and the sharp decline in the NRW [German state of North Rhine Westphalia] headline rate has probably already set the trend, he says. Headline inflation in NRW dropped to 6.9% in March from 8.5% in February. The 10-year Bund yield trades about 3 basis points lower at 2.277%, according to Tradeweb. (emese.bartha@wsj.com)

Big Drop in German Headline Inflation Could Push Bund Yields Lower

0607 GMT – Bond investors focus on incoming inflation data on Thursday, with the German figures likely to show a strong impact of base effects for the first time, potentially pulling Bund yields lower, Metzler’s analysts say in a note. German headline inflation is expected to fall to 7.2% in March from 8.7% in February, measured according to national standards, in The Wall Street Journal’s poll of analysts. “Data dependence is probably the order of the day…and here an extremely weak inflation figure should certainly have an effect,” analysts Uwe Hohmann and Sebastian Sachs say. “Then, Bund yields should also start to move down again somewhat,” they say. (emese.bartha@wsj.com)