Germany's Bund yield hovers below six-month highs

Government bond yields across the euro area nudged lower on Friday, in listless, holiday-thinned trade.

News on Thursday that China is in close touch with the United States on signing a Phase 1 trade deal bolstered sentiment in world markets, keeping stocks near record highs. Still, bond yields across the single currency bloc edged down as markets reopened after the Christmas holiday, reflecting a preference by investors to hold onto safe-haven bonds in illiquid markets.

In early Friday trade, 10-year bond yields in Germany, France, and the Netherlands were just one basis point lower on the day. The Germany Bund yield hovered at -0.26%, holding below six-month highs hit last week at around -0.21%. In southern Europe, Italian bond yields were broadly lower.