AMSTERDAM, April 16 Reuters Euro zone bond yields rose on Friday, following an overnight jump in U.S. Treasury yields after a hefty rally a day earlier.
U.S. Treasury yields dived to onemonth lows on Thursday as a possible safehaven bid related to increased U.S.Russia tensions, along with Japanese buying and technical factors, helped overshadow betterthanexpected economic data.
Benchmark 10year U.S. Treasury yields, which fell more than 10 basis points on Thursday, undid much of that move and were up 6 bps in early European trade.
Euro zone bond yields also started the day higher, with Germanys 10year yield, the benchmark for the region, up 3 basis points to 0.26 at 0735 GMT.
Im not surprised to see a pullback, said Peter McCallum, rates strategist at Mizuho, of Fridays market moves.
McCallum said it was natural to see some pullback from the fall in yields seen on Thursday, which he said took place for largely technical reasons, given further expectations for economic data confirming a speedy economic recovery in the U.S.
Safehaven bond yields tend to rise on news deemed positive for the economy.
Data from the University of Michigan due at 1400 GMT is expected to show a pickup in U.S. consumer sentiment.
Elsewhere, Italy late on Thursday cut its economic growth forecast for this year and said its budget deficit would surge to a 20year high, taking into account a new 40 billioneuro stimulus package the Italian cabinet approved.
The news was largely expected and…