The borrowing costs of Germany's 10-year treasury bonds are likely to reach their highest level since at least 2010, and investors are demanding higher compensation for continued high inflation and growing political uncertainty. The country's Ministry of Finance will tender on Wednesday to issue 5.5 billion euros of bonds due in August 2036. The yield on 10-year treasury bonds that have already been issued hovers around 3.38%. This will be the highest cost of issuing this term bond in at least 16 years. German treasury yields have risen sharply over the past few weeks due to a wave of global sell-offs. After Chancellor Friedrich Mertz's ruling party suffered a crushing defeat in local elections, investors are likely to demand a higher uncertainty premium over the next few months. The 10-year Treasury yield hit a 15-year high earlier this week as energy prices rose due to heightened tension in the Middle East.

The borrowing costs of Germany's 10-year treasury bonds are likely to reach their highest level since at least 2010, and investors are demanding higher compensation for continued high inflation and growing political uncertainty. The country's Ministry of Finance will tender on Wednesday to issue 5.5 billion euros of bonds due in August 2036. The yield on 10-year treasury bonds that have already been issued hovers around 3.38%. This will be the highest cost of issuing this term bond in at least 16 years. German treasury yields have risen sharply over the past few weeks due to a wave of global sell-offs. After Chancellor Friedrich Mertz's ruling party suffered a crushing defeat in local elections, investors are likely to demand a higher uncertainty premium over the next few months. The 10-year Treasury yield hit a 15-year high earlier this week as energy prices rose due to heightened tension in the Middle East.