Euro zone bonds mixed amid Iran deal hopes, U.K. vote also in focus
Euro zone government bonds were mixed on Thursday (May 7, 2026) after staging their biggest rally in a month the previous day, as investors grew optimistic that the U.S. and Iran might soon reach a deal to end the war.
Brent oil prices, which have been a driving force for broader financial markets since the war broke out in late February, were last down modestly below $100 a barrel on Thursday, having slid more than 10% the previous day on the back of the prospect of a U.S.-Iran peace deal.
With some concern about a damaging energy-price shock abating, bonds held on to most of the gains made on Wednesday, when two-year yields, which are most sensitive to expectations for inflation and interest rates, dropped sharply.
Two-year Schatz yields fell nearly 12 basis points on Wednesday, the most since April 8, and were last at 2.56%, roughly unchanged on the day.
-Reuters