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Tight Ranges

BOND SUMMARY
  • EGBs trade in tight ranges, with heavy Italian supplies (equating to 44k BTP or 34k Bund) dominating market flow.
  • Bund remains in green territory, but close to flat on Auction delta hedging.The contract is better bid Led by vaccination pace concerns, after the EU fails to resolves AstraZeneca row, and some fairly dovish comments from a big Hawk (ECB Knot), coupled with EU official suggesting the possibility of further rate cut.
  • Gilt also trade on the front foot, albeit within ranges, and buoyed by by Lockdown and vaccination roll outs.
  • US trades within overnight ranges, with no new risk event news during the European morning sessionLooking ahead, US IJC, GDP and Core PCE are the most notable data. On the supply front, US $62bn 7yr. ECB Schnabel is the notable speaker for today.

Latest levels:

  • Mar US 10-Yr futures (TY) down 0.5/32 at 137-16.5 (L: 137-13.5 / H: 137-19)
  • Mar Bund futures (RX) up 5 ticks at 177.84 (L: 177.64 / H: 177.96)
  • Mar Gilt futures (G) up 9 ticks at 134.78 (L: 134.63 / H: 134.95)
  • Mar BTP futures (IK) down 2 ticks at 151 (L: 150.84 / H: 151.19)

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