Firmer Amid Little Newsflow; Peripheries Tighten

Core/semi-core EGBs are a touch firmer to begin the week, with little in the way of domestic drivers or meaningful headline flow to note.

• Bunds are +2 at 132.78, though technical studies continuing to point to a bearish outlook. The first support is the Feb 29 low at 131.62, while the 20-day EMA at 133.18 remains the first resistance.
• Hedging surrounding EU bond supply may have helped the space away from best levels. The auctions saw smooth enough demand.
• The German and French cash curves have seen some light bull flattening.
• Since Jan 30, the German 2s10s curve has flattened 22.5bps, with short-end yields rising more aggressively than 10-year counterparts as ECB rate cut expectations have moderated.
• 10-year Periphery spreads to Bunds are generally tighter.
• The 10-year BTP/Bund spread is -2bps at 145bps, while PGBs are also supported following S&P's rating upgrade on Friday (see earlier post for details).
• The Euro Sentix survey for March showed a modest improvement vs February.
• A reminder that the ECB are in their pre-meeting quiet period ahead of Thursday's decision.
• The remainder of today's schedule is light.