Yields take another leg higher after ECB's Vasle hints at Q4 ECB hikes

European fixed income had already been under pressure this morning, but yields (particularly at the short-end) have taken another leg higher following comments from ECB's Vasle that more rate hikes will likely be needed in Q4 after the July and September hikes. Curves have bear flattened in response.

• This morning we have seen Eurozone PPI a little below consensus expectations and rising at a slower pace Y/Y than in May relative to June.
• With the US out of the office for Independence Day, there is little else on today's calendar other than more scheduled ECB speaker. Nagel and de Guindos headline later.
• TY1 futures are down -0-0+ today at 119-08 with UST cash closed for the holiday.
• Bund futures are down -1.35 today at 149.50 with 10y Bund yields up 8.7bp at 1.316% and Schatz yields up 10.8bp at 0.607%.
• Gilt futures are down -0.96 today at 115.01 with 10y yields up 8.5bp at 2.168% and 2y yields up 9.1bp at 1.752%.