EGBS: /STIR: Bonds A Little Softer Post-ECB, Implied Rates A Little Firmer

EGBs away from session highs as ECB President Lagarde doesn’t seem too worried by downside risks to growth.

• Comments on the risks to the ECB’s central economic outlook pointed to a mix of downside risks to growth (the focus of the dovish leaning central bankers) and upside risks to inflation (the focus of the hawkish contingent).
• Lagarde stressed that she will not pre-commit when it comes to the October decision. highlighting data-dependence, while noting there is only a relatively short time until the next decision.
• Bund futures still stuck within yesterday’s range, despite printing fresh session highs and lows over the press conference.
• Downticks in equities provide support in recent trade.
• EUR 3m10 vol. to fresh session lows.
• Spreads to Bunds off session tights.
• Previously covered round numbers in BTP/Bunds (140bp) and OAT/Bunds (70bp) still limiting tightening moves.
• ECB-dated OIS little changed to 2bp less dovish vs. levels prevailing ahead of the initial decision.