Report: It is expected that the long-term German government bond yield will to some extent reflect the market's bet on the European Central Bank raising interest rates.

SEB's Jussi Hiljanen stated in a report that in the coming weeks, market expectations for a rate hike by the European Central Bank will continue to rise, spilling over to some extent into long-term bonds, causing the yield curve for German government bonds to continue flattening. The chief interest rate strategist said, "Once the revaluation of inflation is largely completed, the market focus will shift to longer-term growth and monetary policy impacts, and downward pressure on long-term yields should emerge." He said that point has not yet been reached. He said that the 10-year German government bond yield may trade in the range of 3.00% to 3.20%, and then if negative growth impacts become the dominant driver, the yield may turn lower.