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Inflation Breakevens Hold Steady Post-ECB

US
  • 10Y Treasury yields have quickly unwound most of the 6bp sell-off from the initial ECB decision since the presser ended, leaving it up just 0.5bps on the day.
  • The adjustment was almost entirely carried by real yields, back at the 25bps it’s broadly averaged in June to date.
  • It means relatively little change for the 10Y inflation breakeven, sitting at 2.77% having increased from late May lows of 2.555% but off highs of 3.08% (Apr 22) and close to the post-Ukraine war average of 2.80%.

10Y nominal (white), real (green) and breakeven (yellow)Source: Bloomberg

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