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Serene start to the day with subdued inflation data

BOND SUMMARY

After some volatile sessions recently, today has seen core fixed income markets in a more serene mood. Futures are generally down with cash yields higher.

  • European inflation data this morning has been a little on the soft side, with the pan-Eurozone flash HICP coming in at 1.3%Y/Y (1/4% exp) and core CPI at 0.9% (1.1% exp). HICP readings from France and Italy were also a little lower than expected.
  • Looking ahead, ADP employment is due for release while month-end and quarter-end flows will be in focus.
  • TY1 futures are down -0-2+ today at 131-03+ with 10y UST yields up 2.9bp at 1.735% and 2y yields up 0.1bp at 0.149%.
  • Bund futures are down -0.12 today at 170.88 with 10y Bund yields up 2.0bp at -0.268% and Schatz yields up 0.7bp at -0.691%.
  • Gilt futures are down -0.07 today at 127.51 with 10y yields up 2.3bp at 0.846% and 2y yields up 2.0bp at 0.088%.

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