Germany’s 10-year Bund yield fell below 3.45% to its lowest level since September 9, tracking US Treasury yields lower as a global equity selloff drove investors towards safe-haven government bonds. Investors are becoming increasingly cautious about the AI trade, one of this year’s strongest-performing market themes, as companies prepare to report earnings. Intensifying competition, stretched valuations and concerns over surging AI investment have raised doubts about whether corporate earnings can justify the sector’s rapid rally. Despite the recent decline, European bond yields remain near multi-year highs, supported by persistent energy-driven inflationary pressures, resilient economic activity and concerns over France’s public finances ahead of next year’s presidential election. Investors are now turning their attention to Wednesday’s US CPI report and comments from ECB policymakers during this week’s IMF–World Bank meetings for further signals on the outlook for monetary policy.