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US inflation at the forefront

BUNDS
  • Bund remains well within post NFP ranges, with a subdued overnight session, trading just 4.1k Bund pre cash open.
  • ALL EYES are on the US CPI, but Mr Powell will still want a second release in February for the January reading, ahead of the first expected hike in March.
  • Today will nonetheless give the market its first clue on how gradual or aggressive to Fed will be in their tightening cycle.
  • Bund main support is still eyed at the 0.00% yield resistance, circa 169.34, where investors have so far favoured fading, including some likely RECeiving interests, as swaps desks look for yield.
  • No real tier 1 data are left for Europe, it's all about the US inflation. They will also release their Monthly budget statement.
  • SUPPLIES: German EU1.5bn 30yr (Equates to 10.3k Buxl, or 27k Bund)., US $36bn 10yr.
  • SYNDICATION: Portugal 20yr.
  • SPEAKERS: BoE Cunliffe, and Fed Kashkari

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