Rally Extends, Bulls Eye Key Resistance In Futures

Gilts rally alongside core global peers.

• Futures are through yesterday’s high and 99.00, exposing key resistance at the June 21 high (99.23).
• Front end leads the bid, yields 3.0-4.5bp lower on the day.
• Geopolitical risk supports core global FI markets as Hamas confirmed that its political leader was killed in airstrike in Iran. Softer-than-expected French inflation data also factors in.
• Softer-than-expected underlying Australian CPI measures also noted overnight.
• Local headline flow continues to focus on fiscal matters, with Chancellor Reeves pointing to the need to hike taxes in the Autumn Budget.
• Still, Reeves has stressed that the party will stick to its election manifesto, as she promised not to raise national insurance, income tax or VAT.
• That will leave focus on CGT, after Labour looked to placate worry ahead of the election, focusing on closing tax loopholes, avoiding a tax grab from certain sectors.
• Little to note on the local calendar today,