Interest rates continue to rise
Source: Thomson Reuters
After an increase in the yield on ten-year German Federal bonds until the beginning of February, it then fell during the remainder of the first half of 2018. While the US Federal Reserve (Fed) has already raised the key interest rate twice to a range of 1.75 to 2.00%, the European Central Bank (ECB) intends to slow down its extremely loose monetary policy at a very slow rate. Although the bond purchase program will be cut by half from October 2018 and completely phased out by the end of the year, it is unlikely that the ECB will raise interest rates until the summer of 2019. Other curative effects on bonds included uncertainty due to trade disputes, driven mainly by the USA, and the election of a Eurosceptic government in Italy.