Ranges Still Contained, Operating Near Worst Levels

Core EGB benchmarks find a bit of a base in recent trade, although fail to bounce.

• Wider macro headline flow remains limited.
• BoE-dove Dhingra hasn’t impacted BoE/gilt pricing in a meaningful manner.
• Bond bears failed to force key European benchmarks meaningfully through morning lows (some modest breaches were seen).
• That leaves the benchmarks in relatively contained ranges, with Bund, OAT & BTP futures failing to breach yesterday’s best levels earlier today.
• Downside interest via Schatz & Bund put plays have headlined on the flow side.
• Bunds are -32 ticks at 132.94 at typing, still operating within well-defined technical parameters. The first support is 132.71 (Feb 16 low) while the 20-day EMA at 134.21 is the first resistance.
• Peripheral spreads to Bunds are unchanged to a touch wider on the session, as European equity markets move off best levels of the day.