EUROPEAN FIXED INCOME UPDATE: core bonds bid then roundly offered

A real round trip for debt markets and the so called safe havens in particular as they were in demand and highly sought after when the risk wheels appeared to be on course to come right off, but subsequently shunned when fears of an all out Russian attack on Ukraine dissipated during the course of the European am session. In short, it seems that Russia is confining its incursion and intentions to the two areas in Eastern Ukraine that called for independence, while rejecting wider separatist claims and Ukraine’s President still does not believe there will be a full invasion or widespread escalation. However, the latter is anticipating more Russian military aggression and the Foreign Ministry has called for diplomatic ties with Russia to be cut. So, it’s far from all resolved and volatile across the border even though Bunds, Gilts and the 10 year T-note are all nearer intraday lows than highs within 167.17-165.99, 121.75-121.07 and 127-09/126-15 respective extremes. Note also, Germany’s Ifo survey was much better than expected and BoE’s Ramsden is expecting some further, albeit modest, further tightening in coming months. 

22 Feb 2022 - 11:08- Fixed IncomeResearch Sheet- Source: newsquawk