LONDON, March 17 Euro zone government bond
yields jumped on Friday after a European Central Bank
policymaker said the central bank will decide at a later time
whether to raise interest rates before or after ending its bond
Austrian central bank governor Ewald Nowotny told a
newspaper on Thursday that the ECB could hike its deposit rate,
currently below zero, before the main rates at which it lends to
Germany's two-year government bond yield rose as high as
minus 0.69 percent, its highest in around five
weeks, and yields on 10-year borrowing costs across the euro
area rose 3-6 basis points.
Money market futures also sold off as investors started to
bet the ECB could raise interest rates sooner rather than later.
Euribor money market futures were down 2-6 basis points
across the 2017-2019 strip.
(Reporting by Dhara Ranasinghe, editing by Nigel Stephenson)