Trans-Atlantic Forces Felt

Trans-Atlantic spill over in recent trade.

• We initially saw light tailwinds for gilts on the back of the Canadian CPI data, but the move was limited, which is understandable given the relatively modest reaction in CAD rates.
• Fedspeak from Waller then applied some weight before fading.
• Gilt futures see incremental fresh session highs of 97.88 on the follow, although still operate in a narrow 34-tick range.
• Previously covered initial technical levels in the contract remain untouched, leaving a short-term bullish backdrop in play.
• Cash gilt yields are ~3bp lower on the day.
• Solid demand for the latest 20-Year gilt auction and another fall in the Kantar supermarket inflation metric provided domestic support this morning.
• A reminder that BoE Governor Bailey will speak at 18:00 London, we have covered that in detail on several occasions today.
• CPI data hits first thing tomorrow (07:00 London), expect our preview of that release to cross shortly.