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USTs continue descent ahead of FOMC Minutes

  • Treasuries have continued their slide after the hawkish comments from Brainard yesterday, and ahead of today's FOMC Minutes. The focus of the Minute will be on the language surrounding the pace and timing of tapering, and also on any language around the likelihood of 50bp hikes in upcoming FOMC meetings.
  • Gilts have been dragged lower by Treasuries, too, with the German curve also lower but seeing smaller moves than gilts or USTs.
  • Looking ahead we have more comments from ECB's Lane as he participates in a panel on inflation dynamics but there is little else on the calendar.
  • There is still continued focus on le Pen moving up in the polls for the French election (albeit still at as a major underdog to Macron's reelection). OAT-Bund spreads are little changed today, but peripheral spreads are a little wider.
  • TY1 futures are down -0-15+ today at 120-14 with 10y UST yields up 7.1bp at 2.620% and 2y yields up 3.9bp at 2.556%.
  • Bund futures are down -0.48 today at 157.25 with 10y Bund yields up 3.8bp at 0.649% and Schatz yields up 1.5bp at -0.14%.
  • Gilt futures are down -0.48 today at 120.34 with 10y yields up 6.1bp at 1.713% and 2y yields up 5.3bp at 1.501%.

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