German bunds edge lower following higher-than-expected manufacturing PMI, 30-year auction in focus

The 10-year German government bunds edged lower Tuesday, following higher-tahn-expected manufacturing PMI. Also, investors will now be focusing on the super long 30-year bund auction, scheduled to be held on Wednesday.

The yield on the benchmark 10-year bond, which moves inversely to its price, rose 1 basis point to 0.38 percent, the long-term 30-year bond yields also climbed nearly 1 basis point to 1.14 percent and the yield on short-term 2-year bond traded 1/2 basis point higher at -0.67 percent by 08:50 GMT.

At 54.7, the Markit Flash Germany Composite Output Index still pointed to robust growth in January that was faster than the 2016 average (54.3). However, the latest reading was down from 55.2 in December and the lowest in four months.

Further, the Martkit Eurozone PMI registered 54.3 in January according to the preliminary flash estimates. Although down marginally from 54.4 in December, the latest reading was the second highest since December 2015 and one of the highest readings seen over the past five-and-a-half years.

Lastly, markets will now wait for today’s scheduled speech of the European Central Bank Governor Mario Draghi ahead of the consumer inflation and labor market data, scheduled for release next week, besides German Bundesbank President Weidmann’s speech on Wednesday.

Meanwhile, the German stock index DAX Index traded 0.04 percent higher at 11,549 by 08:55 GMT, while at 9:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 7.86 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex