EUROPEAN INFLATION: Belgium Services CPI Continues to Accelerate in February

Little lasting reaction to cross-asset moves in gilts, with the recovery from yesterday’s lows in oil and equity markets having more impact elsewhere.

• Futures back towards session highs in recent trade, last -9 at 92.33 (92.13-36 range).
• The medium-term trend condition in the contract remains bearish. However, recent gains continue to highlight a corrective phase and signal scope for a continuation higher near-term.
• Initial support and resistance located at 91.10/92.68.
• Yields little changed across the curve.
• 2s10s 0.5bp off ’25 highs, 5s30s on track for a fresh ’25 closing high.
• Recent tightening to Bunds extends. 10-Year ~1.5bp tighter at 204bp, spread on track for lowest close since early November.
• 1.125% Sep-35 I/L supply was digested smoothly.
• BoE-dated OIS still little changed on the day, showing ~71.5bp of easing for ’25.
• We continue to look for cuts in February and May, with ~22.5bp and ~42.5bp of cuts currently priced through those meetings.
• SONIA futures flat to +1.0.
• Little of note on the UK data calendar this week, which will leave focus on the long end & broader macro cues, as well as issuance.

ERU5 97.625/97.50/97.375p fly 1x3x2, bought for -0.5 in +3k.