LONDON, July 3 (Reuters) - Germany’s benchmark 10-year government bond yield matched the European Central Bank’s deposit rate for the first time on Thursday, in the latest sign that markets are braced for interest rate cuts soon.
The German Bund yield fell to -0.4%, the same level as the ECB’s deposit rate of minus 0.4%.
The last time 10-year bond yields in the euro zone’s biggest economy fell near ECB rates was during the global financial crisis.
In December 2008, the ECB depo rate was 2.75% and the 10-year Bund yield fell to 3.04%. Germany’s Bund yield dipped briefly below the ECB’s main refinancing rate on Dec 12, 2008.
The deposit rate has become the ECB’s defacto policy tool since 2015, when the ECB cut the rate but left its other interest rates unchanged. (Reporting by London markets team; Editing by Virginia Furness)