ECB to Hold Rates on July 23, Euro Zone Bond Market May Ease as Lagarde Leaves September Door Open

According to Commerzbank strategist Rainer Guntermann, the euro zone government bond market may ease Thursday (July 23) as the European Central Bank is expected to hold rates unchanged and President Christine Lagarde has not pre-committed to a rate hike in September. Current money markets expect the ECB to maintain rates on Thursday. Guntermann noted that 10-year German government bond yields, having approached the 3.2% mark this year, should provide support, while upcoming purchasing managers' index (PMI) data may remind markets of ongoing challenges to economic growth. He added that recent developments in energy prices add further uncertainty to the rate outlook.
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