The day began on a hesitant note, but by the end of the day, Europe was gradually becoming heavier.

The yield on the ten-year German Bund fell by 4.8pts to 2.559%, our OATs were up 5.1pts to 3.0800%, and Italian BTPs fell sharply, with a yield up 7pts to 3.9030%.
This was rather unexpected behavior, given that EU inflation figures had been deemed reassuring this morning.

The US bond market is also in the red, with T-Bonds down 3.5pts to 4.5080%.
The gilts have gone through the roof in the space of a few hours: the market was closed on Monday and reopened on Tuesday (-6.5pts to 4.232%), before falling +10.5pts in a straight line to 4.3280% (i.e. +2.8pts in the end).

To everyone's surprise, US consumer confidence improved: the Conference Board published a score of 102 versus 97.5 in April, while the consensus was for a fall to 96.

More important dates will mark the end of the week, starting with Friday's release of inflation figures, which will be closely watched in the US and Europe.

These data will provide further information on future interest rate trends, particularly from the Fed, in a climate of growing skepticism about the possibility of further rate cuts.



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