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Gilt/Bund spread tests the December high

BONDS
  • Following the UK Inflation coming above consensus, Gilt and Bund continue to see some divergence, and Investors will still be favouring for the ECB to move first in cutting its rates versus the BoE and the Fed.
  • Fed Powell also signaled that Policymakers will wait for longer given the latest inflation reading.
  • Gilt/Bund spread has cleared 180.0bps and is now testing the next immediate resistance right here at 183.4bps, the December high.

Chart source: MNI/Bloomberg.

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