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The sell-off in government bonds had intensified in recent weeks, driving interest rates higher almost everywhere in the world. Yields on the bond markets in the euro zone have risen by around 30 basis points since the beginning of December. Because investors are betting that the US Federal Reserve might raise interest rates as early as March in view of the galloping inflation, and thus earlier than originally expected on the financial markets. The yield on ten-year US Treasuries rose accordingly to plus 1.892 percent. “There are also rumors that the first rate hike might not only come in March, but that it will be 50 basis points, the largest hike in more than 20 years,” said Craig Erlam, market analyst at brokerage firm Oanda.
