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OUTLOOK

After yesterday's plethora of central bank speakers (who didn't really come off the topic and give much insight into near-term monpol) and sovereign issuance, today the market might take a little bit of a breather and look ahead to tomorrow's US CPI print.

  • There are still five ECB speakers due today: Villeroy, Holzmann, Vujcic, Rehn and de Cos.
  • While today will also see the release of Spanish IP and Italian retail sales.
  • Despite the pullback in sovereign issuance today, Germany will still launch its new 10-year Bund via auction (the 2.30% Feb-33 Bund - the first 10-year Bund with a coupon in excess of 2% in over a decade). And we will also have a US 10-year Treasury auction this afternoon.
  • However, tomorrow's US CPI print is likely to trump these. Both headline and core are expected to fall in Y/Y terms, but the question will be to what extent and will this have any impact, particularly on the Fed's terminal rate views.

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