Eurozone bond yields edge higher as tensions in the Strait of Hormuz push up oil prices

(1) On Thursday, eurozone bond yields edged slightly higher. Due to cooling expectations for the implementation of the Strait of Hormuz navigation agreement, international oil prices rebounded from the previous day's lows, triggering market volatility. (2) The yield on Germany's 10-year government bond rose by 3 basis points to 3.253%, continuing to approach a fifteen-year high. Yields on 2-year and 30-year German government bonds also edged up slightly. (3) The Prime Minister of Qatar will visit Iran to advance US-Iran diplomatic consultations. The main disagreement between the two parties centers on the management of the Strait of Hormuz, a key waterway that carries one-fifth of the world's energy transportation, with tensions affecting inflation expectations. (4) The market expects the European Central Bank to further raise interest rates within the year, with a high probability of implementing rate hikes at the September policy meeting to counteract the inflation and economic impacts stemming from geopolitical tensions. (5) Recent inflation concerns and regional fiscal pressures have driven government bond yields in many eurozone countries to continue rising, reaching their highest levels in more than a decade.