German bunds surge despite better-than-expected Eurozone industrial production; eyes on ECB’s account of monetary policy meeting

The German bunds surged Thursday as investors have largely shrugged-off the eurozone’s industrial production for the month of November. Also, market participants are closely eyeing the European Central Bank’s (ECB) account of the monetary policy meeting, scheduled to be released today by 12:30GMT.

The German 10-year bond yields, which move inversely to its price, slumped 2-1/2 basis points to 0.45 percent, the yield on 30-year note plunged 3 basis points to 1.29 percent and the yield on short-term 2-year traded 1/2 basis point lower at -0.62 percent by 10:45GMT.

Perhaps most notable today will be the publication of the account of the ECB’s December monetary policy meeting. Judging from Mario Draghi’s post-meeting press conference, the meeting was a relatively inconsequential one, with the principal focus having been the updated economic forecasts.

Nevertheless, with the Governing Council hawks having recently been particularly vocal – e.g. with Bundesbank President Weidmann calling for a definite end-date for the ECB’s bond purchase programme and Executive Board member Benoît Cœuré also raising doubts about policymakers’ current language on the policy outlook – the account might shine some further light on the relative strength of support for the existing forward policy guidance, which continues to leave open the possibility of additional asset purchases after September and continues to foresee rates remaining at current levels well past the horizon of the net asset purchases. 

Meanwhile, the German DAX fell 0.21 percent to 13,254.00 by 10:45 GMT. Lastly, FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest