EUROPEAN FIXED INCOME UPDATE: data clearly more of an issue than supply
Analysis details (11:11)
There is little doubt that actual expectations often differ from market consensus and precipitate an abnormally large reaction, and the extended/ongoing bounce in Gilts is a case in point given that headline UK inflation only fell 0.1 ppt short of the mark in both m/m and y/y terms. However, the high on Liffe has been 119.49 for a 65 tick gain on the day vs 16 tick loss in very early trade and in contrast to flat-lining Bunds within 152.76-18 extremes in wake of what must go down as one of the best German debt offerings in history. In fact, the cover was the strongest ever and retention only 10.5% to set a high bar for the upcoming 20 year US sale as Treasuries narrowly straddle parity awaiting housing data and Fed’s Harker either side of the note auction.
18 May 2022 - 11:11- Fixed IncomeResearch Sheet- Source: Newsquawk
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