Tsys Steady, Gilts Underperforming Pre-US CPI

Core global FI is mostly softer ahead of the first of the week's major risk events - US CPI (our preview is here).

• Treasury yields have largely traded sideways ahead of the release (0830ET/1330GMT) - core eyed most closely, 0.3% M/M survey, with a modest skew to the upside.
• A modestly risk-on atmosphere prevails, with S&P futures touching 4,000.
• Bunds are cheaper but yields have retraced from session highs, while Gilts are underperforming. EGB periphery spreads are mixed.
• Some attention on BoE pricing, with terminal rates pushing above 4.70% (Aug-Sep 2023) for the first time in a few weeks. Labour market data out earlier was largely in line, with higher nominal wages still negative in real terms on high inflation.
• German ZEW reading was mixed, with expectations slightly stronger than expected, but "current situation" was weaker.
• In the US, aside from CPI, the 30Y Bond re-open at 1300ET also features.

Latest levels:

• Mar US 10-Yr futures (TY) up 2.5/32 at 113-29 (L: 113-25 / H: 114-01)
• Mar Bund futures (RX) down 25 ticks at 140.23 (L: 139.77 / H: 140.4)
• Mar Gilt futures (G) down 42 ticks at 104.6 (L: 104.59 / H: 105.23)
• Italy / German 10-Yr spread 0.4bps wider at 189.3bps