German government bonds were largely unchanged, underperforming Italian bonds amid a broader narrowing of yield spreads, while Germany issued 12-year and 15-year bonds. A rebound in equity markets weakened demand for core fixed-income assets, although European government bonds overall slightly outperformed U.S. and UK bonds.

European Central Bank Governing Council member Boris Vujcic stated that while officials have regained control of the price situation, they must remain vigilant against risks. Vujcic made these remarks while addressing EU lawmakers and is expected to be confirmed as the next ECB vice president.

Meanwhile, in a Bloomberg survey, more than half of the economists polled anticipate that ECB President Christine Lagarde will step down before her term ends.

UK bonds experienced a bear steepening during a data-light trading session. Bank of England Monetary Policy Committee member Megan Greene noted in an article that the BOE does not need to "follow the Fed." She indicated that if an unexpected Fed rate cut leads to a further decline in U.S. yields, it "could exert upward pressure on UK growth and inflation." However, she concluded that it is unreasonable to set monetary policy based on the risk of surprises from another central bank, adding that the BOE "should focus on factors determining the UK inflation outlook and set policy accordingly."

Market data: German 10-year bond yield was little changed at 2.71%. German bond futures were flat at 129.64. Italy’s 10-year bond yield fell 1 basis point to 3.31%. The Italy-Germany yield spread narrowed by 1 basis point to 60 basis points. France’s 10-year bond yield declined 1 basis point to 3.26%. The UK 10-year bond yield rose 1 basis point to 4.32%.