Softer Ahead Of This Week's Risk Events

Core/semi-core EGBs are slightly softer to start the week, with a cautious tone ahead of this week's risk events.

• Notable headline flow has generally been light.
• Bunds are -14 ticks at 131.69, just below Friday's low of 131.71. A continuation lower would expose key support and the bear trigger at 131.23, the Feb 29 low.
• Brent crude futures are off intraday highs, but remain firmer on the day and will have weighed on the wider core FI space earlier.
• Weekend drivers include hawkish Fed and BoJ speculation, while ECB-speakers (de Cos and Rehn) did little to change the narrative around current ECB rate cut pricing (currently centred around the June meeting).
• 10-year periphery spreads to Bunds are generally tighter, After hours Friday, Moody’s moved Spain’s Outlook to positive on Friday but left their rating unchanged at Baa1. SPGB's did not see major tailwinds though, with Moody's rating still one notch below S&P's.
• The 10-year SPGB/Bund spread is -0.6bps at 79.6bps, while the BTP/Bund spread is -1.2bps at 124.5bps, still off last week's tightest levels around 116bps.
• Final Eurozone CPI data headlines the regional calendar today.
• Looking ahead, the regional calendar is highlighted by survey evidence (INSEE, ZEW, PMIs, IFO, Belgian Business Confidence) as well as focus on external events such as the Fed, BOE and SNB decisions.