U.S. government debt yields followed European rates lower Wednesday after new data suggested a gloomier economic outlook amid German business leaders.
Bond yields around the world dipped after the Ifo Institute reported that confidence in German c-suites unexpectedly fell in April. The Munich-based researcher's business climate indicator fell for a seventh month in the last eight and contradicted upbeat forecasts with a 99.2 print. April's print was the indicator's lowest reading since 2016.
The new data could point to persistent worries surrounding the United Kingdom's exit from the European Union and slowing growth in general.
"The mood among German managers became slightly gloomier this month," Ifo President Clemens Fuest said in a press release Wednesday. "March's gentle optimism regarding the coming months has evaporated. The German economy continues to lose steam."
At 10:36 a.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was lower at around 2.52%, while the yield on the 30-year Treasury bond was also lower at 2.949%. The German 10-year bund traded at -0.014%.
In the United States, the Treasury is set to sell $41 billion in 5-year notes and $20 billion in two-year floating rate notes. The Federal Reserve is one week away from its latest monetary policy decision on May 1, when it will decide whether to adjust the overnight lending rate.
Oil prices dropped on Wednesday amid signs that supply is still adequate despite the U.S. announcing a push for tighter sanctions on Iran and a plan to halt waivers that had allowed limited Iranian oil imports.