Eurozone bond yields were little changed on Monday as investors waited to see if the Federal Reserve would raise U.S. interest rates for the first time in a decade this week, while data suggested a further slowdown in China.
Markets are pricing a 30 percent chance that the Fed will raise rates at a two-day policy meeting that ends on Thursday. That is down from around 50 percent last month, before China devalued its currency in the face of weakening growth.
Even if the Fed holds off, it is likely to hint a rate increase will come at its October or December meeting – keeping focus on the repercussions for global financial markets.
Domestic growth in the United States may support a rate rise, but turmoil in China and dwindling expectations for inflation have kept U.S. policymakers cautious.
Weekend data from China on industry and investment showed the world's second-largest economy cooling at a faster rate than expected in August, although signals from retail and housing were brighter.
"The big hurdle to overcome for the coming days is Thursday's FOMC," said Societe Generale strategist Ciaran O'Hagan.
German 10-year yields – the euro zone's benchmark – were unchanged on the day at 0.65 percent, in the middle of the 0.50-1.00 percent range where they have traded the past four months.
Lower-rated equivalents in Spain and Italy were also flat at 2.11 percent and 1.83 percent, respectively. The gap between Spanish and Italian yields remained near its highest in over two years, on worries secessionists will win an election in Catalonia on Sept 27.
Hundreds of thousands of people began massing in the streets of Barcelona on Friday to call for the northeastern region to break away from the rest of Spain. The region accounts for nearly a fifth of Spain's output and population.
Greek yields, meanwhile, remain near the lowest levels seen this year before an election that is likely to prove inconclusive.
The Syriza party of former Greek prime minister Alexis Tsipras — which came to power in January on a pledge to renegotiate terms of Greece's international bailout but ultimately gave in to creditor demands — has a thin lead in the polls over the conservative New Democracy.
Greek 10-year yields were 6 bps lower on Monday at 8.71 percent.