LONDON, March 14 Europe's benchmark German bond
yield climbed to its highest level in 14 months on Tuesday,
dragging up other euro zone equivalents in its wake, as
nervousness around upcoming elections in the Netherlands and
France appeared to recede.
A poll published on Monday showed Dutch Prime Minister Mark
Rutte's pro-business VVD party set to take 18 percent of
Wednesday's vote, ahead of the 16 percent polled for Geert
Wilders's anti-Muslim Freedom Party.
A local news report that France's Socialist ex-Prime
Minister Manuel Valls will ask voters to back centrist Emmanuel
Macron was also seen denting the chances of far-right Marine Le
Pen who polls show will falter in May's presidential run-off.
Meanwhile, data confirmed that Germany's annual inflation
rate last month surpassed the European Central Bank's price
stability target of just under 2 percent for the first time
since September 2012.
"We just have now revised some of the political risks, and
given the overall economic environment something like 50 basis
points for 10-year Bund yields looks to be something of a new
normal," DZ Bank strategist Daniel Lenz said.
German 10-year yields topped 0.50 percent for first time in
14 months, up 3 basis points on the day. Spanish
10-year yields hit their highest since November 2015 at 1.94
percent,, and Italian equivalents their highest
since July 2015 at 2.41 percent.
(Reporting by John Geddie, editing by Nigel Stephenson)