Euro zone ministers flag concern over rising bond yields, rule out fragmentation

Euro zone finance ministers are monitoring the recent climb in government bond yields across the currency area with concern, but do not view the move as a source of alarm, the head of the euro zone finance ministers' group said on Friday.

"I would say we are concerned but not anxious. We're not seeing fragmentation in the euro area," Kyriakos Pierrakakis told a news conference in Dublin.

His remarks suggest that while policymakers are attentive to the direction of borrowing costs in the 21 countries that share the euro, they do not currently see the kind of divergent pressure that has previously raised questions about the cohesion of the bloc.

Speaking alongside Pierrakakis, European Economic Commissioner Valdis Dombrovskis characterised the rise in yields as a normal market reaction to global developments. He said the trend reinforced the case for keeping fiscal policies prudent.

The comments came as ministers gathered for talks in the Irish capital, with bond market movements among the issues under discussion.