Bond markets in Europe traded in mixed order on Thursday: the flurry of detailed figures published this morning had little impact on price levels, but things started to move at 2:30 pm with the US figures.

Our OATs rose from 2.9040% to 2.8500% in the space of 1 hour: in the end, they erased -4.6pts to 2.864%, Bunds -4pts to 2.36% and British Gilts remained unchanged at 4.057%.
On the other hand, Italian BTPs eased sharply, with a spectacular -13pts to 3.7030%, while Spanish Bonos erased -7.5pts to 3.3180%.
Macro index publications began this morning with the HCOB PMI composite index of overall activity in France: it recovered from 48.1 in February to 48.3 in March, signalling the smallest drop in private sector activity since the start of the current period of contraction, which began ten months ago.

In contrast to the decline in activity, the contraction in overall new business volume accelerated in the private sector as a whole, reflecting an accentuated downturn in demand in both manufacturing and services.

In the Eurozone, the HCOB composite PMI index for overall eurozone activity stood at 50.3 in March, compared with 49.2 in February.
Growth in the private sector in March was only marginal, however, as continued contraction in the manufacturing sector offset the impact of only moderate growth in the services sector.

Investors took note of a series of US statistics as of 2:30 p.m.: the US trade deficit widened to $68.9 billion in February, compared with the previous month's $67.6 billion (which was revised from an initial estimate of $67.4 billion), according to the Commerce Department.

This 1.9% month-on-month increase in the deficit reflects a 2.2% rise in US imports of goods and services, to $331.9 billion, while US exports rose by 2.3% to $263 billion.

The Labor Department announced that 221,000 new US jobless claims were registered for the week ending March 25, up 9,000 on the previous week's revised figure (212,000 instead of 210,000).

T-Bonds were little changed, with the '10-yr' easing marginally by -0.8Pt to 4.346%... and the '2-yr' tightening symmetrically by +1.2Pt to 4.6910%.

Investors will also continue to keep a close eye on the impact of rising oil prices, with a barrel of US light crude (West Texas Intermediate, WTI) now peaking at its highest level since October.

Brent and WTI are consolidating modestly at $89.2 and $85.1 respectively, which remains close to a five-month high.
Gold, which most often moves inversely to yields, confirms that it has severed this link since mid-December 2023: yield tension has had absolutely no impact for the last 6 weeks (rebound to $1990 in mid-February), and in fact, gold has been advancing since testing $1,675 at the end of October 2022.


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