German bund yields post decline after President Trump adopts populist tone

The 10-year German government bund yields posted decline Monday after the United States President Donald Trump maintained a populist tone during his speech at the country’s 45th Presidential Inaugural ceremony held on Friday.

Also, markets are now looking forward to the super long 30-year bond auction, scheduled to be held on January 25.

The yield on the benchmark 10-year bond, which moves inversely to its price, dived 3 basis points to 0.39 percent, the long-term 30-year bond yields also plunged 3-1/2 basis points to 1.65 percent and the yield on short-term 2-year bond also traded 1/2 basis point lower at -0.67 percent by 08:10 GMT.

President Trump in his speech said that protectionism will lead to great prosperity and strength and that he will fight for it thoroughly, putting his country on the top priority every time. He further added that every policy from now on will be directed solely to benefit the Americans at first.

The German bunds have been closely following developments in the U.S. debt market. The U.S. benchmark 10-year bond yields slumped 3 basis points to 2.43 percent, from Friday’s low of 2.44 percent.

Lastly, markets will now wait for the release of manufacturing PMI and business confidence data, scheduled for release next week, besides German Bundesbank President Weidmann’s scheduled speech on Wednesday.

Meanwhile, the German stock index DAX Index traded 0.90 percent down at 11,525 by 08:55 GMT, while at 8:00GMT, the FxWirePro's Hourly Euro Strength Index remained slightly bullish at 76.68 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex