Bond Report: U.S., European government-bond yields remain higher after ECB decision

European and U.S. government-bond yields remained higher on Thursday after the European Central Bank left its benchmark interest rate unchanged as expected.

In a statement released along with the decision, ECB President Mario Draghi cautioned that the central bank stands ready to expand its asset-purchasing program if it doesn’t see a sustained pickup in inflation.

Tom di Galoma, managing director for Treasury trading at Seaport Global, said the statement suggests that the central bank believes the risk of inflation remaining subdued outweighs the risk that it might overshoot the ECB’s targets.

“The thing the ECB faces is unfortunately more populism coming through Europe in the next year or two where governments could decide to actually leave,” di Galoma said.

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