EU DEBT LATEST: 10 year benchmarks back in lock-step, and now lower

No real clear-cut catalyst or rationale, but bonds have succumbed to a bout of selling pressure and Bunds have handed back their slender relative gains over Gilts in the process. Some are pointing to ‘source’ reports indicating an upgrade to the ECB’s Staff GDP projection for 2018 (2.5% touted from 2.3% previously), while another technical failure ahead of 157.00 may also have left buyers bereft of further upside incentive and intraday longs could simply be squaring up or paring back positions ahead of the ECB. Irrespective of rhyme or reason, the core Eurex debt future has been down to 156.65, -16 ticks and 27 ticks off best levels, while Gilts have extended their losses to 19 ticks to 121.07 vs +5 ticks at one stage. Elsewhere, US Treasuries remain relatively side-lined and immune/flat ahead of the US open and weekly jobless claims, but next week’s 3, 10 and 30 year auction details may provide some impetus.