EUROPEAN FIXED INCOME UPDATE: bond bears becoming more assertive

Analysis details (10:52)

Almost deja vu for debt futures after another round of early EU bullish price action fizzled when Bunds were encouraged by bleak German data to extend beyond 136.50 to 136.53, Gilts got close to 102.00, at 101.92 on their core Eurozone peer’s coattails and the T-note tagged along to top 113-00, at 113-02+. The ensuing retreat could easily and naturally be put down to pre-NFP positioning for another upside surprise given mostly strong anecdotal pointers, but bonds may also be losing traction from a technical and momentum perspective having hit w-t-d peaks on Wednesday and falling short of retesting or surpassing those pinnacles since. Moreover, latest EZ inflation data has not been as soft vs consensus compared to the initial readings from Spain, Germany and France and commentary from ECB and Fed officials remains hawkish on balance to leave the respective benchmarks nearer 135.74, 101.20 and 112-25 lows awaiting the US employment report.

06 Jan 2023 - 10:52- Fixed IncomeResearch Sheet- Source: Newsquawk