EUROPEAN INFLATION: ECB Underlying Inflation Metrics Support Disinflation Story
The ECB's PCCI series, which is staff's preferred metric to track medium-term inflation pressures, t...
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BUNDS: 10s Back Towards Middle Of Multi-Month Range, 5s30s Holds Below 100bp
EU-U.S. trade angst has underpinned EGBs today.
- Bulls have breached the 50-day EMA in Bund futures (130.21), with the contract topping out at 130.48 so far.
- Next resistance located at the July 4 high (130.76).
- Yields 4-9bp lower as the curve bull flattens.
- Zooming out, the pullback puts 10-Year yields closer to the middle of the range that has been in place since late March (see chart below).
- Meanwhile, 5s30s haven’t been able to consolidate any breaches above 100bp in recent sessions, with that curve back to 96.6bp today.
Fig. 1: German 10-Year Yield (%)
BONDS: Bull Flattening Extends After Well-Received BoE Sale
Spillover from the long end of the UK curve, in the wake of a well-received BoE APF sale from the long bucket, underpins wider core global FI markets, with major global bond futures hitting fresh session highs as the bull flattening theme apparent earlier in the session extends.
EQUITIES: Fresh ATHs For E-Minis
The aforementioned weakness in e-minis has more than reversed, at least in part aided by news that Ukraine has tabled a meeting with Russia, although the country stresses that leaders must ultimately meet to provide effective talks (differences surrounding any post-war norms continue to present stumbling blocks).
- S&P 500 e-minis hit fresh all-time highs, bulls now eye the 1.764 projection of the April 7-10-21 price swing (6,381.50).
