Analyst: The European Central Bank's interest rate cut has suppressed the rise in long-term bond yields

ChainCatcher news, Swedish Nordea Bank analyst Hjalmar N. said in a report that the European Central Bank's rate cuts are currently helping to alleviate the upward pressure on long-term government bond yields caused by Germany's more expansionary fiscal policy. "However, once the market is convinced that the European Central Bank has completed its rate-cutting cycle, this situation could change rapidly." He stated that the market's focus will then shift to the timing of the first rate hike, which is expected to start pushing long-term rates higher.

He noted that for investors, this means there is no structural downside for eurozone long-term government bond yields, and any decline should be viewed as an opportunity to buy as long-term rates rise.