April 16, 2024 09:30 GMT
Unwind Yesterday’s Relief Rally As UK Wages Print Strong
EGBS
Core/semi-core EGBs have unwound most of yesterday afternoon’s relief rally, with Bunds -18 ticks at 131.63.
- This morning’s firmer-than-expected UK wages provided the initial source of weakness, while the ongoing 30-year DSL tap from the Netherlands will be weighing at the long-end.
- A stronger-than-expected German ZEW expectations print will have also pressured the space.
- Today’s ECB speakers (Makhlouf and Rehn) have not deviated from the status quo regarding a likely ECB rate cut in June. Villeroy and Vujcic are scheduled later this afternoon.
- The German and French cash curves have bear steepened. While 10-year periphery spreads to Bunds generally little changed.
- Developments in the Middle East alongside several Fed speakers (including Chair Powell after hours) will set the tone for the rest of the session.
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