# US/German bond yield gap widest in 20 years on diverging policy outlooks

> The gap between short-dated US and German borrowing costs widened to its largest since 1997, reaching about 281 basis points. The spread reflects diverging policy outlooks, with Fed Chair Powell reiterating gradual rate hikes while euro zone inflation slowed. Markets expect the Fed to tighten more than planned due to fiscal stimulus.

- Date: 2018-03-01 · published 2018-03-01T12:00:00.000Z
- Category: macro · region Global · magnitude low
- Page: https://feedsoft.ai/events/66193-us-german-bond-yield-gap-widest-in-20-years-on-diverging-policy-outlooks
- Commodities: [US Dollar (Broad)](https://feedsoft.ai/c/DXY.md), [Euro (USD per EUR)](https://feedsoft.ai/c/EURUSD.md)

## Why it matters

A widening yield gap attracts capital into dollar assets and supports the currency, which can weigh on dollar-priced commodities. Euro weakness relative to the dollar also affects European export competitiveness.

## Read by commodity

- DXY: bullish ▲
- EURUSD: bearish ▼

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| DXY | 2018-05-16 | [US and German bond yields have widened to levels not seen in almost 30 years](https://feedsoft.ai/events/65212-us-and-german-bond-yields-have-widened-to-levels-not-seen-in-almost-30-years.md) | -0.0% | +0.9% |
| DXY | 2023-03-07 | [AUD tumbles on heels of divergent RBA and Fed policy outlooks - OFX (US)](https://feedsoft.ai/events/37125-aud-tumbles-on-heels-of-divergent-rba-and-fed-policy-outlooks-ofx-us.md) | +0.3% | -1.0% |
| DXY | 2024-03-27 | [EUR/USD continues lower on diverging interest-rate outlook](https://feedsoft.ai/events/31419-eur-usd-continues-lower-on-diverging-interest-rate-outlook.md) | +0.2% | +1.4% |
| DXY | 2023-10-26 | [Ringgit reverses gains on increasing US bond yields \| Scoop](https://feedsoft.ai/events/33893-ringgit-reverses-gains-on-increasing-us-bond-yields-scoop.md) | +0.0% | -2.9% |
| DXY | 2021-04-28 | [US Growth and Fed's Policy Outlook to Lift Yields Again, Lending Support to USD - ActionForex](https://feedsoft.ai/events/47824-us-growth-and-fed-s-policy-outlook-to-lift-yields-again-lending-support-to-usd.md) | +0.3% | -1.0% |
| EURUSD | 2018-05-16 | [US and German bond yields have widened to levels not seen in almost 30 years](https://feedsoft.ai/events/65212-us-and-german-bond-yields-have-widened-to-levels-not-seen-in-almost-30-years.md) | -0.7% | -0.7% |
| EURUSD | 2024-03-27 | [EUR/USD continues lower on diverging interest-rate outlook](https://feedsoft.ai/events/31419-eur-usd-continues-lower-on-diverging-interest-rate-outlook.md) | -0.6% | -1.2% |
| EURUSD | 2021-04-28 | [US Growth and Fed's Policy Outlook to Lift Yields Again, Lending Support to USD - ActionForex](https://feedsoft.ai/events/47824-us-growth-and-fed-s-policy-outlook-to-lift-yields-again-lending-support-to-usd.md) | -0.5% | +1.3% |

## Sources

- finance.yahoo.com: https://finance.yahoo.com/news/us-german-bond-yield-gap-084234372.html

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.