11.02.202614:33:40UTC+00German 10-Year Yield Rebounds as Strong US Jobs Data Curb Fed Cut Bets

Germany’s 10-year Bund yield rebounded to 2.8% after briefly touching a four-week low of 2.793%, as investors pared back expectations for Federal Reserve rate cuts in response to stronger-than-expected US labor market data. US nonfarm payrolls increased by 130,000 in January, the largest monthly gain in over a year, while the unemployment rate unexpectedly declined to 4.3%, underscoring the continued resilience of the labor market at the start of 2026.

Money markets now fully price in the first Fed rate cut by July instead of June, with the probability of a move in March seen at below 5%. In Europe, investors also weighed signals that the European Central Bank remains broadly comfortable with the euro’s recent appreciation, alongside reports that Bank of France Governor François Villeroy de Galhau — regarded as one of the more dovish policymakers — will step down earlier than previously planned.

ECB President Christine Lagarde said last week that the inflation outlook remains in a “good place,” while downplaying concerns about the recent strength of the single currency.