Commerzbank rates strategist Erik Liem said positive developments from Iran have
pushed oil prices lower and supported German government bonds, with the 10-year
Bund yield probing levels below 3.2%. Bunds have strengthened both on absolute
price and versus swaps, weighing on yields, but eurozone government bond spreads
remain weak. Although intra-eurozone spreads narrowed on Tuesday, their move has
lagged the drop in energy prices and remains near highs seen in the early phase
of the Iran conflict.
