Euro zone bond yields jump as U S Iran peace hopes fade and ECB rate outlook shifts again

Markets now price in three ECB hikes despite gloom

Euro zone bond yields surged as optimism around a U.S.-Iran peace deal faded, leaving investors to price in three European Central Bank rate hikes this year. Higher oil prices and fresh geopolitical uncertainty weighed on sentiment, while German inflation held at 2.9% in April—adding pressure to expectations for tighter ECB policy.