EUROPEAN FIXED INCOME UPDATE: supply digested, but parts of Sintra less palatable

Analysis details (10:46)

Debt futures have extended their pull-back from yesterday’s best levels to deeper lows at 134.39, 95.64 and 113-01 for Bunds, Gilts and the T-note respectively, but this fails to tell the full story as the 10 year bonds also nudged the top end of their intraday parameters at one stage. In fact, the core Eurozone benchmark looked poised to bridge the gap to Monday’s high when reaching 134.89 with some impetus from a lower German Q3 refunding remit and before ECB President Lagarde stressed that the war against inflation is still not over. Meanwhile, a solid DMO linker sale has not offered Gilts any support and BTPs remain below par as they weigh up decent demand for short-dated Italian issuance against a spike in the ECB’s 7-day MRO that might TLTRO repayment-related. Still to come, tier one NA data, yet more from Sintra via hawk Schnabel and Usd 43 bn 5 year supply.

27 Jun 2023 - 10:46- Research Sheet- Source: Newsquawk