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Back From Highs, Little Changed On Day

BONDS
Bank Of England (BOE) Market NewsHomepageBond Market NewsEuropean Central Bank (ECB) Market NewsBulletMarketsFixed Income Bullets

Bonds are off early highs, with EGB & gilt supply, coupled with a recovery from session lows in equities, countering the early rally.

  • Bund and gilt futures traded through yesterday’s highs before fading. Bulls failed to test the next meaningful levels of resistance.
  • German yields are ~1bp lower across the curve.
  • EGB spreads to Bunds are 0.5-2.0bp wider on the day, with the early flight-to-quality and presence of Spanish & French supply driving moves there.
  • Both sets of auctions were smoothly digested.
  • German ASWs were wider at the open but have pulled back from highs.
  • Gilt yields are 1bp lower across the curve.
  • Soft pricing metrics at the latest 5-Year gilt auction applied modest pressure.
  • Short end markets are back to little changed on the day.
  • ECB-dated OIS shows ~24bp of cuts for this month and ~61bp of easing through year end.
  • BoE-dated OIS shows ~43bp of cuts through year end, with the next ~25bp cut fully discounted through the Nov MPC.
  • BoE’s Pill will appear on a panel later this morning, although we are unsure if there will be any media coverage.
  • U.S. data is set to continue to dominate the macro landscape ahead of tomorrow’s NFP release.
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Bonds are off early highs, with EGB & gilt supply, coupled with a recovery from session lows in equities, countering the early rally.

  • Bund and gilt futures traded through yesterday’s highs before fading. Bulls failed to test the next meaningful levels of resistance.
  • German yields are ~1bp lower across the curve.
  • EGB spreads to Bunds are 0.5-2.0bp wider on the day, with the early flight-to-quality and presence of Spanish & French supply driving moves there.
  • Both sets of auctions were smoothly digested.
  • German ASWs were wider at the open but have pulled back from highs.
  • Gilt yields are 1bp lower across the curve.
  • Soft pricing metrics at the latest 5-Year gilt auction applied modest pressure.
  • Short end markets are back to little changed on the day.
  • ECB-dated OIS shows ~24bp of cuts for this month and ~61bp of easing through year end.
  • BoE-dated OIS shows ~43bp of cuts through year end, with the next ~25bp cut fully discounted through the Nov MPC.
  • BoE’s Pill will appear on a panel later this morning, although we are unsure if there will be any media coverage.
  • U.S. data is set to continue to dominate the macro landscape ahead of tomorrow’s NFP release.