Kornelius Purps
Kornelius Purps
advanced assume barrel beat conclude environment fall german growth impression information machine market mind monday oil payroll per price reality report retail sales sell shared start strong tells time treasury week yields
Assume that a time machine is beaming you back to Monday morning. You start the week with the impression of an unexpectedly strong 274k US payroll report in mind. In addition, a clairvoyant tells you that: 1) US retail sales surged by 1.4% m-o-m in April, 2) German growth advanced by 4% q-o-q annualized in Q1 2005, 3) speculation about a revaluation of the Renminbi will intensify, 4) the oil price will fall by about USD 3.50 per barrel this week, 5) and the US Treasury will sell USD 51 bn in Treasury Notes. You make up your mind and conclude that in this environment yields need to go up. At least 99 out of 100 market participants with the same information would have shared your view. But reality is different. Yields are down and down and down again. These are Schwarzenegger markets, no one can beat them.
believe demanded government hard history implement majority mandate rating reforms since structural tight war
With Italy's history of more than 50 different governments since World War II, it's hard to believe that a government with such a tight majority will have the mandate to implement the structural reforms demanded by the rating agencies.
currently economic fall percent road seeing strong yields
What we are seeing currently is that it's not a one-way road for strong economic data. Ten-year yields could fall to 3.35 percent in a month.
data inflation point positive starting yields
We had positive inflation data out of Europe, and the U.S. as well. It's the starting point for yields to come down again.
against bonds goes higher mini number rally rates stronger weaker
We could get a mini rally for bonds from a weaker number because it goes against the big expectations for higher rates and stronger growth.
bright euro figures investors might remind seen somewhat yield
These somewhat disappointing figures might remind investors that not everything is bright in the euro zone. The long end has seen its yield highs.
absolutely forecasts hikes imply june market price rate staff
The substantial upward revisions of the staff forecasts imply more rate hikes to come. The market is absolutely right to price in a June rate hike.
annual data declining economic figure growth helps lower market near react release shape showing
In the near term, the gilt market will react to any economic data release that helps shape investors' BOE view. The annual growth figure was lower than expected, showing continuation of declining growth.
certainly definitely fed higher increase lead possible raising rate second supply
The Fed will definitely be raising the rate at the end of this month, and it's certainly possible we'll get a second rate increase later. With some supply pressure, that will also lead to higher yields.
chance course data good hike lower move point rate reasonably time yields
In all likelihood, disappointing data will at some point in time dampen rate hike expectations. There's a reasonably good chance for yields to move substantially lower over the course of this year.
bad given gm good news rule time worse
It's yet more bad news for GM and we can't rule out the possibility of even worse to come. Given the big sell-off we've had in Treasuries, this is a good time to buy.
discussion earlier hike indicator levels marked rates start whether
The ZEW indicator is at levels which previously have marked a high, and discussion will now start on whether the ECB will hike rates earlier than in March. This will put the front-end under pressure.
drop floor help prices reached sentiment short warning
This is a warning that sentiment developments aren't a one-way street, and we may have reached a peak. With the help of ZEW, prices should find a floor and shouldn't drop in the very short term.
drop floor help prices reached sentiment short warning
This is a warning that sentiment developments aren't a one- way street, and we may have reached a peak. With the help of ZEW, prices should find a floor and shouldn't drop in the very short term.