The support of this line is near 1.34%, and if the yield drops below that level, we could see further losses toward 1.2%. That could have major implications for other markets - for example; stocks should be supported, along with precious metals, while the USD will most likely decline notably.
On Tuesday, the US ISM non-manufacturing PMI, a key gauge of service-sector activity, fell more than expected and printed 60.1, way below 64.0 in May. Additionally, the German ZEW survey (economic sentiment) cratered from 79.8 to 63.3 in July. So the economic activity in Germany and the USA might be slowing already.
Today's data showed that German industrial production fell 0.3% in May, a lot weaker than the 0.5% growth expected; later in the day, traders will pay attention to the FOMC minutes from the latest decision, which was surprisingly hawkish.
From other news, the Nasdaq 100 index pushed to new record highs today and is approaching the psychological level of 15,000 USD. Other US indices were also higher during the London session, while EU benchmarks were seen circa 1% stronger.