German government bond yields near multi-year highs due to ECB rate hike expectations

LootboxPhobia · 2026-03-12T12:54:44+00:00

German government bond yields are approaching multi-year highs as markets anticipate the European Central Bank will raise interest rates, driven by inflation concerns triggered by Middle East conflicts. The 10-year bond yield has risen to 2.938%, while oil prices have climbed due to the conflict and expectations of disrupted oil flows through the Strait of Hormuz.

LootboxPhobia

2026-03-12 12:54:44

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Investing.com – On Thursday, German government bond yields hovered near multi-year highs, as market expectations for a rate hike by the European Central Bank (ECB) increased, driven by inflation concerns sparked by the Middle East conflict.

Fears that the conflict and related disruptions to oil flows through the Strait of Hormuz will persist for a long time have led to rising oil prices.

According to data from Investing.com, the yield on the 10-year German government bond rose 0.2% to 2.938%, after reaching 2.963%, the highest level since October 2023.

Reuters reports that the currency market has fully priced in the expectation that the ECB will raise interest rates before July, with a 60% chance of a second rate hike by December.

In late February, before the outbreak of war, traders believed there was about a 40% chance that the ECB would cut rates by the end of the year.

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