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A busy, and large morning volume session

BONDS
  • Longer end Germany 10yr and 30yr (Bund, Buxl) rallies on short cover, squaring, yield hunting, and a Dove Christine Lagarde overnight.
  • " Raising interest rates would not solve any of the current problems,” “On the contrary: if we acted too hastily now, the recovery of our economies could be considerably weaker and jobs would be jeopardized", she told Redaktionsnetzwerk
  • BTP/Bund spread widens by another 6bps today, and test next target area at 166.2655
  • A more subdued range bound session for Gilts, the contract is flat at the time of typing, while the Gilt/Bund spread is 1.6bp wider, but mostly led by the price action in the German contracts.
  • The 2yr printed a 1.6358% yesterday (highest since 24/12/19),
  • Yield this morning are lower, as Treasuries stay underpinned by Germany and the Bund.
  • Looking ahead, there is nothing left in terms of tier 1 data for Europe. Main focus will be on the US Michigan on its inflation component.

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