Futures Testing Yesterday’s High

German FI futures are incrementally firmer vs. yesterday’s settlement levels, with Bunds +15 on the day, testing yesterday’s best levels.

• Regional headline flow has been fairly inconsequential since yesterday’s close.
• The accounts of the ECB’s most recent monetary policy decision will cross today, although with a 25bp hike at this month’s meeting essentially fully priced and the Bank’s post-summer break data-dependent stance well defined, there may not be much in the way of meaningful market moves after the release.
• Fiscal policy guidance from the Eurogroup will cross later today. A quick reminder that our policy team have flagged their understanding that “Euro Area finance chiefs agree the bloc’s fiscal stance for 2024 should be significantly more restrictive than 2023 following years of covid and energy cost support measures, but there is less accord among member states on what that should mean in terms of quantitative consolidation.”
• When it comes to supply, Italy will hold its mid-month 3/7/15-50-year auction this morning, selling up to E10bn, including the launch of a new 3-Year line.