Ifo Helps Bid Develop Further, Vasle Comments Do Little

Softer-than-expected ifo data provides some background support for German paper, even with last week’s weaker-than-expected round of PMI readings conditioning the market for a disappointing release.

• This means that comments from ECB Governing Council member Vasle, who pushed back on both the depth and start point of market pricing re: ’24 easing, owing to his expectations surrounding inflation, was generally ignored. Vasle also stressed that Q1 data is key for the ECB.
• Bund futures are +10 or so, just shy of recent session highs, with the bounce from lows developing a little further.
• Initial resistance in the contract (137.57) is still 10-15 ticks away form best levels of early trade.
• German yields are little changed to 1bp lower across the curve.
• 10-Year yields hover just above 2.00%.
• EGB spreads vs. Bunds are generally within 1bp of Friday’s closing levels.