Fixed-income markets are back to square one, as Tuesday's deterioration wipes out the previous day's gains (and then some, as new annual lows are tested in the US).

Monetary policy expectations have reversed in the US, where a rate cut is no longer expected before early May: the yield on US 10-year Treasuries is down +5.4pts to 4.1510%, while the 2-year is down +4.1pts to 4.411%.

The German ten-year yield also rallied by +4.6pts to 2.335%, OATs by +2pts to 2.842% and Italian BTPs by +4.4pts to 3.9170%.

By far the worst performer of the day was the British Gilts, which were down +12pts at 4.0290%.

Statistics in Europe were expected to be very quiet today, as in the United States.

Volatility should return tomorrow with the PMI activity indices for Europe, followed by the first estimate of fourth-quarter US growth, and then the PCE index due on Thursday.


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