German bunds steady following eurozone’s unchanged June CPI; investors cautious as G-20 Summit kicks in

The German bunds traded steady during European trading session Friday after eurozone’s consumer price inflation (CPI) data for the month of June, remained unchanged from that in May.

However, investors remained cautious as top leaders gather at the G-20 Summit in Osaka, Japan for a 2-day meeting, starting today.

The German 10-year bond yields, which move inversely to its price, slipped nearly 1 basis point to -0.322 percent, the yield on 30-year note traded flat at 0.263 percent and the yield on short-term 2-year too remained flat at -0.729 percent by 10:20GMT.

Euro area annual inflation is expected to be 1.2 percent in June 2019, stable compared to May, according to a flash estimate from Eurostat, the statistical office of the European Union.

Looking at the main components of euro area inflation, ‘food, alcohol & tobacco’, ‘energy’ and ‘services’ are expected to have an annual rate of 1.6 percent in June. The annual rate of ‘non-energy industrial goods’ is expected to be 0.2 percent.

Markets have retained the positivity of the last couple of days as we head into this weekend’s meeting between Presidents Trump and Xi. After separate meetings with PM Modi and PM Abe, Trump says he expects to announce “very big” trade deals with both countries, Lloyds Bank reported.

However, while positive, the focus remains very much on the rift between the US and China. President Xi’s recent comments have been less diplomatic, deriding protectionism and “bullying practices”, the report added.

Meanwhile, the German DAX traded tad 0.43 percent higher at 12,324.09 by 10:25GMT, while at 10:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 18.80 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex