Global Economic Fears Push German Bond Yields to Six-Month Low

German bond yields dropped to their lowest in six months as investors turned to safer assets. Weak U.S. economic data and geopolitical tensions added to market anxiety. The Bank of England's rate cut also made bonds more appealing. Germany's 10-year bond yield fell, reflecting broader euro zone trends.

In a move highlighting growing economic concerns, German government bond yields dropped to a six-month low on Friday. Investors, spooked by weak U.S. economic data and geopolitical tensions, rushed towards sovereign debt, causing a concurrent tumble in global stock markets.

Germany's 10-year bond yield, the euro zone's benchmark, fell by 5 basis points to 2.201%, marking its lowest level since February. This trend points to a significant shift in investor sentiment, driven by a combination of the Bank of England's interest rate cut and increased expectations for a Federal Reserve cut.

Further exacerbating market jitters, rising U.S. jobless claims and declining manufacturing activity painted a grim economic outlook, pushing investors away from riskier assets like Italian bonds. As European stocks suffered, bond yields illustrated a clear preference for safer investments, revealing the underlying market dynamics in unsettled economic conditions.

(With inputs from agencies.)