Euro zone bond yields steady ahead of Fed decision
LONDON, Sept 17 (Reuters) -Euro zone bond yields held steady on Tuesday, a day before a decision on interest rates from the U.S. Federal Reserve, which could impact expectations for what step the European Central Bank might take with monetary policy.
* German 10-year yields DE10YT=RR, which serve as the benchmark for the wider euro zone, were up 1.6 basis points at 2.136% in early trading. Bund yields have fallen nearly 20 basis points since the start of September alone.
* Two-year Schatz yields DE2YT=RR were up 1 bp at 2.193%.
* Traders think the ECB, which cut rates last week, is leaning more towards another 25-bp cut at the December meeting, rather than October, while U.S. markets shows investors are placing a near-70% chance the Fed will cut rates by 50 bps on Wednesday.
* Italian 10-year yields IT10YT=RR were flat at 3.48%, leaving the premium over Bunds DE10IT10=RR broadly unchanged at 134.2 bps.
* Germany's ZEW index of economic sentiment for September is due at 0900 GMT and expected to show that confidence deteriorated this month, leaving the index at 17 from August's 19.2. A reading of 17 would be the lowest since January.
Reporting by Amanda Cooper; Editing by Andrew Heavens
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