The yield on the German 10-year Bund dropped to 2.5%, nearing its lowest point since May 7, after Eurozone inflation data came in softer than expected, strengthening bets on a 25 basis point ECB rate cut later this week and fueling speculation of further easing, despite recent remarks from officials favoring a pause in rate cuts. Eurozone consumer price inflation eased to 1.9% in May, down from 2.2% in April and below the anticipated 2.0%, marking its first dip beneath the ECB’s target since September 2024. Additionally, services inflation fell to its lowest level since March 2022, while core inflation reached its lowest point since January 2022. Meanwhile, market sentiment remained subdued amid the OECD’s downgraded global growth forecast and ongoing trade uncertainties, as the US pushes for final trade offers by Wednesday, following recent threats by former President Trump to double tariffs on steel and aluminum.