The European financial markets saw little action today, due to a lack of economic indicators and, above all, the absence of US investors on Wednesday (Juneteenth).

This holiday on the other side of the Atlantic could have served as a test in the absence of "external elements", but nothing very remarkable happened, other than that the underlying trend since the evening of June 7th took hold, with the spread between the OAT (+3.1Pts to 3.151%) and the German Bund (+1.3Pt to 2.403%) widening.
This represents a mere +2Pts, but the spread is now +75Pts, following a rally of around -10Pts since Monday.
Italian debt has suffered the most today, with yields up +6.21pts to 3.950%, while Spanish 'bonos' are up +3pts (as are our OATs) to 3.344%.
Clearly, it is the 'Bund' that is once again acting as a safe haven, after a brief 48-hour interlude.

Gilts (+5pts to 4.1030%) have clearly not benefited from the announcement of a further fall in UK inflation: consumer prices rose by just 2% year-on-year in May, compared with +2.3% in April.

This is good news as market operators await the Bank of England's (BoE) monetary policy meeting on Thursday, at the end of which no rate cut is expected.

Several statistics will also punctuate the end of the week, including the PMI activity indices for Europe, due out on Friday.

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