STIR: Either Side Of Unchanged Following Uncertainty In France; ECB Speak

 Euribor futures are +1.5 to -1.5 through the blues. French political uncertainty and ECB speak have weighed on broader European FI markets, although the major EGB futures are off session lows.

• Spread widening to Bunds is seen in EGBs, with OATs and BTPs under the most pressure, as you would expect, given the aforementioned drivers.
• ECB speakers since Friday’s close (Lagarde, Nagel, Holzmann and Kazaks) have continued to underscore the Bank’s cautious/data-dependent approach when it comes to the next move for rates.
• ECB-dated OIS continue to price just 1bp of easing through the July 18 meeting.
• The next full 25bps rate cut is fully priced through the end of the year, with a ~75% implied probability of a move priced through the end of the October meeting.
• This comes after last week’s ECB decision (along with subsequent rhetoric from various GC members) and U.S. NFPs provided some hawkish inputs for pricing.
• Today’s regional data calendar is limited, while ECB’s Nagel and Holzmann are scheduled to speak again.
• Wider market focus will be on Wednesday’s US CPI/Fed decision and the BoJ on Friday.