EU's vaccine policy in focus for markets

It has been a mixed morning for core fixed income today with gilts and Bunds a bit higher but Treasuries a bit lower.

• The focus today will be on the virtual EU Summit where vaccines are likely to be the market focus. Our political risk team notes there will be three main issues: 1) whether there will be export blocks from the EU (looking likely to not have formal blocks based on the latest news reports), 2) internal negotiations on how vaccines are being distributed internally within the EU, 3) whether Russian vaccines will be approved within the EU - which has wider implications for EU-US relations.
• There are also a number of central bank speakers due today, primarily due to the ongoing virtual BIS conference.
• TY1 futures are down -0-1 today at 132-02 with 10y UST yields up 1.0bp at 1.620% and 2y yields down -0.4bp at 0.144%.
• Bund futures are up 0.22 today at 172.39 with 10y Bund yields down -1.5bp at -0.369% and Schatz yields down -0.5bp at -0.723%.
• Gilt futures are up 0.20 today at 128.65 with 10y yields down -2.4bp at 0.733% and 2y yields down -1.5bp at 0.041%.