FX.co ★ German Yields Cut Losses as Markets Weigh US Jobs Beat, ECB Signals Pause

The yield on Germany's 10-year Bund moderated earlier declines to stabilize just below 2.6%, as investors considered a stronger-than-anticipated US employment report alongside the recent European Central Bank (ECB) decision. The US economy gained 139,000 jobs in May, surpassing the projected 130,000 but showing a decline from April's adjusted figure of 147,000, thus reducing concerns about a more severe downturn in the labor market amid escalating trade tensions instigated by President Trump. In Europe, the ECB reduced interest rates by 25 basis points and lowered its inflation projections for 2025 and 2026, attributing these changes to subdued energy prices and a strengthened euro. Nevertheless, ECB President Christine Lagarde indicated that the bank is approaching the conclusion of its monetary easing phase, hinting at a potential pause in future actions. Additionally, ECB policymaker Yannis Stournaras noted that the eurozone has achieved a soft landing, with the majority of rate cuts likely behind, although uncertainty persists, particularly regarding the prospective effects of new tariffs.