UK possible move to Plan B lifting core FI

The big news of the morning has been various media outlets reporting that the UK could be about to announce that its Covid-19 Plan B will come into effect from perhaps as early as tomorrow (with an announcement later today - but no confirmation on timing yet). We highlighted this as one of the top developments to watch earlier this morning. On the announcement we have seen the short sterling strip move higher, gilt futures spike higher (with the gilt curve seeing a parallel shift) and GBP under pressure.

• Bunds have been dragged higher on the news, while Treasuries are also reacting.
• This will be the key event of the day for core FI markets with JOLTS also due later.
• TY1 futures are up 0-12 today at 130-22+ with 10y UST yields down -3.5bp at 1.441% and 2y yields down -2.2bp at 0.670%.
• Bund futures are up 0.28 today at 174.74 with 10y Bund yields down -1.7bp at -0.394% and Schatz yields down -1.4bp at -0.748%.
• Gilt futures are up 0.28 today at 127.48 with 10y yields down -3.0bp at 0.697% and 2y yields down -3.3bp at 0.418%.