German bunds tad higher despite better-than-expected November retail sales data; jobless rate in focus

The German bunds remained tad higher during European session Monday amid a muted trading session that lacked data of major economic significance; also, the rise in the country’s retail sales for the month of November failed to create an impact.

Germany’s unemployment rate for November, due on January 9 by 10:00GMT will add further direction in the debt market.

The German 10-year bond yields, which move inversely to its price, fell nearly 1-1/2 basis points to 0.195 percent, the yield on 30-year note also suffered nearly 1-1/2 basis points to 0.849 percent while the yield on short-term 2-year hovered around -0.600 percent by 09:40GMT.

This week is set to be a relatively busy one for euro area economic data, with several reports due on the strength of activity in November and sentiment in December. Today kicks off with euro area retail sales figures for November, which look set to show a second successive monthly increase which would also point to positive growth in consumer spending over Q4 as a whole, Daiwa Capital Markets reported

Also the release of the German sales figures, which showed a healthy rise of 1.4 percent m/m – the most since April – following an upwardly revised increase of 0.1 percent m/m the previous month.

ECB speakers this week will include Vice President De Guindos today and Bank of France Governor (and possible next ECB President) De Galhau on Friday. In the markets, finally, Germany will sell 2030 inflation-linked bonds tomorrow, and 10-year Bunds on Wednesday. France will sell a range of bonds on Thursday, while Italy will sell 3-year and 7-year BTPs on Friday, the report added.

Meanwhile, the German DAX slipped 0.33 percent to 10,731.52 by 09:45GMT, while at 09:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at -31.40 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex