German bunds gain ahead of October ZEW economic sentiment index, September Eurozone CPI

The German bunds gained during European session Monday as investors wait to watch the country’s ZEW economic sentiment index for the month of October, scheduled to be released on October 16 by 09:00GMT and the eurozone’s consumer price inflation (CPI) for the month of September, due to be released on October 17 by 09:00GMT.

The German 10-year bond yields, which move inversely to its price, slipped nearly 1/2 basis point to 0.496 percent, the yield on 30-year note also edged 1/2 basis point lower at 1.122 percent and the yield on short-term 2-year traded nearly 1-1/2 basis points lower at -0.601 percent by 09:40GMT.

Data-wise, it should be a fairly quiet week for top-tier releases from the euro area with perhaps most notable Wednesday’s release of final euro area inflation figures for September. These are expected to confirm the flash estimates showing headline CPI rising 0.1ppt to 2.1 percent y/y, while core CPI declined 0.1ppt to 0.9 percent y/y. An upwards revision of 0.1ppt to the core rate, however, is possible, Daiwa Capital Markets reported.

In the markets, Germany will sell 2-year bonds on Tuesday, followed by 25-year bonds on Wednesday, while France and Spain will auction bonds with various maturities on Thursday.

Meanwhile, the German DAX rose 0.11 percent to 11,535.25 by 09:45GMT, while at 09:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 4.32 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex