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Inflation focus moving European markets today

  • As has been the case on most morning's this week, core fixed income continues to trade within yesterday's ranges.
  • The most interesting moves this morning have been for peripheral spreads which have widened notably. Italian and Greek 10-year spreads are over 3bp wider on the day to Bunds while the Euribor strip has underperformed both the short sterling and Eurodollar strips as inflation concerns are hitting European markets more today (after having seen larger moves in short sterling and Eurodollar futures earlier this week, these moves can largely be seen as a catch up).
  • Looking ahead the only notable speakers are ECB's Lane, BOE's Haskel and Fed's Williams.
  • In the US we will receive Michigan confidence and JOLTS data.
  • TY1 futures are up 0-1+ today at 130-12 with 10y UST yields up 2.6bp at 1.578% and 2y yields up 2.7bp at 0.543%.
  • Bund futures are up 0.07 today at 170.49 with 10y Bund yields down -0.1bp at -0.234% and Schatz yields down -0.2bp at -0.780%.
  • Gilt futures are down -0.14 today at 126.19 with 10y yields up 0.9bp at 0.928% and 2y yields down -1.5bp at 0.538%.

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