German Schatz yield at highest in 2-1/2 years

LONDON: The two-year German government bond yield rose to its highest in almost two-and-a-half years on Thursday before a European Central Bank meeting that could signal if the next interest rate hike would be in June or July.

The Schatz last yielded 1.95 percent, up 3 basis points on the day. The level marks the 23.6 percent retracement of the yield fall between June 2008 and March 2009 and is seen as a short-term resistance level.

However, analysts say it could test 2 percent later in the day if the ECB signals a rate hike in June.

Bund futures were 41 ticks down on the day at 122.07.