German bunds sink after Ifo business climate index surges to all-time high in October; ECB in focus

The German bunds sank Wednesday after the country’s business climate index during the month of October unexpectedly rose to a record high in October after falling for two months in a row. Also, markets are awaiting the European Central Bank’s (ECB) monetary policy decision, to be unveiled on October 26 by 11:45GMT.

The German 10-year bond yields, which move inversely to its price, jumped nearly 2 basis points to 0.48 percent, the yield on the 30-year note climbed 1-1/2 basis points to 1.28 percent and the yield on short-term 2-year traded flat at -0.70 percent by 09:25GMT.

The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of some 7,000 firms, rose to 116.7 from an upwardly revised reading of 115.3 in September. The reading was higher than a Reuters consensus forecast for a value of 115.2.

"Companies are very optimistic about the months ahead. They also upwardly revised their very favorable assessments of the current business situation. Germany’s economy is powering ahead," Reuters reported, citing Clemens Fuest, Ifo Chief.

Meanwhile, the German DAX traded 0.11 percent lower at 12,999.00 by 09:30 GMT, while at 08:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 54.29 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest