German bunds steady in subdued trade; GDP growth in focus

The German bunds traded nearly flat Friday, succumbing to thin trading activity during a relatively quiet session that witnessed data of little significance.

The yield on the benchmark 10-year bond hovered around -0.085 percent mark, the yield on long-term 30-year note dipped 1/2 basis point to 0.405 percent and the yield on short-term 2-year bond remained steady at -0.618 percent by 08:50 GMT.

The German bunds have been closely following developments in oil markets because of their impact on inflation expectations.

The crude oil prices climbed for a seventh straight day, with Brent crude rising above $50 for the first time in six weeks as the world's biggest producers prepared to discuss a possible freeze in production levels. The International benchmark Brent futures rose 0.02 percent to $50.90 and West Texas Intermediate (WTI) jumped 0.27 percent to $48.35 by 08:00 GMT.

Moreover, investors did not react to the higher producer price index (PPI), which rose 0.2 percent m/m in July, against market expectations of 0.1 percent m/m after gains of 0.4 percent m/m in May and June. On an annual basis, it declined by 2.0 percent compared with 2.2 percent previously and the lowest rate of decline since August 2014.

Lastly, investors will remain keen to focus on the upcoming economic data, highlighted by PMIs, Q2 GDP, Business expectations, Ifo Business Climate and GfK German consumer climate.

Meanwhile, the German stock index DAX Index traded 0.81 percent lower at 10,518 by 08:50 GMT.