PMIs drive core FI higher - with Bunds leading the way

Flash PMI data has been the driver of markets this morning.

• Bunds have seen the biggest moves in core fixed income with disappointing PMI prints across France, Germany and the Eurozone, with several of the prints coming in below 50 - with Germany in particular looking very weak. Schatz yields have fallen 21bp on the day with the Germany curve bull steepening.
• Gilts have been dragged around by Bunds but are underperforming - with the underperformance helped further by a slightly higher than expected PMI print - in contrast to the European misses.
• Treasuries have seen the smallest moves on the day, but have still moved higher, although the curve has flattened.
• Looking ahead, the only notable scheduled event is the US PMI print. Markets are likely to continue to digest this morning's PMIs, yesterday's larger-than-expected ECB 50bp hike and begin to look towards next week's FOMC meeting.
• TY1 futures are up 0-22 today at 119-19 with 10y UST yields down -6.6bp at 2.811% and 2y yields down -3.2bp at 3.055%.
• Bund futures are up 1.99 today at 154.17 with 10y Bund yields down -16.8bp at 1.050% and Schatz yields down -21.0bp at 0.436%.
• Gilt futures are up 1.02 today at 117.26 with 10y yields down -10.6bp at 1.938% and 2y yields down -12.1bp at 1.865%.