German bond yields fall as risk sentiment sours

Investors were turning to the safe-haven appeal of German government bonds on Tuesday as global risk sentiment continued to sour and momentum trades unwound further.

European shares were set to open with steep losses, while U.S. futures were also retreating further after a sharp sell-off late on Monday.

Germany's 10-year yield, the benchmark for the euro zone, fell 1.5 basis points (bps) to 2.697%. It touched its joint highest in six weeks on Monday at 2.718%. Bond yields move inversely with prices.


Italy's 10-year bond yield was little changed at 3.447%.

That widened the yield gap between Italian and German 10-year bonds, a measure of return investors demand to hold Italian debt over German, to 74 bps. (Reporting by Samuel Indyk; Editing by Andrew Heavens)