EUROPEAN FIXED INCOME UPDATE: Bunds scorched by blistering EZ inflation

In truth, the core Eurozone bond was already pulling back after yet another ‘dead cat’ bounce faltered, at 169.17 on this occasion, but the final straw came in the form of preliminary Eurozone inflation data that was likely to beat consensus, though not by the extent that panned out. Hence, Bunds are now back below par and looking for underlying bids/support under Tuesday’s 168.65 Eurex session low that could come around 168.50 or 168.31, and closer to 5 bp in yield terms. Predictably, Gilts and US Treasuries are paring back in sympathy with the former under 122.00 vs 122.21 at best and 10 year T-note sub-128-00 between 128-02+/127-26 parameters. Still to come, ADP and the Quarterly Refunding Announcement.

02 Feb 2022 - 10:44- Fixed IncomeData- Source: Newsquawk