The deluge of record highs on Wall Street seems to be overshadowing Treasuries: the "A.I." theme and the upturn in US growth forecasts for 2024 are creating a risk-on climate, confirmed by the VIX, which is contracting (confidence is rising) below 12.80.

As a result, risk-off assets are being abandoned and yields are continuing to rise, pushing T-Bonds, for example, up to 4.20%, i.e. beyond a technical resistance threshold of 4.1800%.
There are no figures to justify this deterioration in bond yields: traders are incorporating the increasingly consensual prospect of a "soft landing" in the United States, and the statements made by several members of the FED.
The week just ending has also revealed major disparities in global growth, with the US economy showing insolent health, far ahead of Europe and China, which are tending, at best, to stagnate.
As a result, it's not even certain that the FED will 'pivot' next May if the labour market remains at its zenith (with wage rises in sight) and if inflation resurfaces, after having eased at the end of 2023, thanks to very positive 'base effects'.

The climate also remains very heavy in Europe (6th week of tension): the
Bund yield is approaching 2.385% (+2.5pts) and our OATs are flirting with 2.895% (i.e. +2pts and +15pts in a week, the 2.85% resistance level has been exceeded), while Italian BTPs are showing a spread of +2.5pts towards 3.960%.
Once again, Gilts are the "red lantern", down +7.5 basis points to 4.1250%... and the picture is even bleaker over the past week, with no less than +20 basis points, the worst performance among the top 10 Western bond issuers.

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