A fine session on the European bond markets, with the trend over the past week remaining very positive, with -4.3 basis points on Bunds at 2.427%, -3 basis points on our OATs at 3.082% and -4.5 basis points on Italian BTPs at 3.7060%.7060%.
On the figures front, the 'ZEW' barometer of economic sentiment in Germany fell in July for the first time in a year, to 41.8, 5.7 points below its June value.
The fact that German exports fell more than expected in May, political uncertainty in France and the lack of clarity regarding the ECB's future monetary policy contributed to this development", explains Achim Wambach, ZEW's President.

On the other hand, the assessment of the economic situation in Germany has improved slightly, with the expectations indicator rising by 4.9 points this month to -68.9.

T-Bonds are easing along the same lines as their European counterparts, with the 2034 T-Bond down 4.5pts to 4.183% (equalling the lows of almost 4 months), while the 30-year is down 6pts to 4.3940%.
By contrast, the 2-year and 3-month are unchanged at 4.455% and 5.3400%: the US yield curve therefore remains inverted.

In the early afternoon, US investors were treated to the latest US retail sales figures: after rising by 0.3% in May compared with the previous month (revised from the 0.1% increase initially announced), US retail sales remained flat on a sequential basis in June, according to the Commerce Department.... although they were expected to fall by -0.2%.

Excluding the automotive sector (vehicles and equipment), which can be volatile, US retail sales rose by 0.4% last month compared with the previous month, following a 0.1% increase in May.

Import prices in the USA stagnated in June, as the fall in oil prices (fuel prices were down 1% after having already fallen by 0.4% in May), was offset by food prices, which rebounded by 0.7% after having fallen by 1.6% the previous month.

Excluding oil, the prices of imported products rose by 0.2% in June, compared with a fall of 0.3% the previous month.
Over 12 months to the end of June, import prices rose by 1.6%, their biggest gain since December 2022 (+3.2%).

Finally, the Commerce Department announced a 0.5% rise in US business inventories in May, following a 0.3% increase in April (confirmed against the initial estimate).
U.S. business sales remained stable at a sequential rate in May (taking 1.37 months to clear inventories, as in the previous month).

These new data confirm the risk of a slowdown in growth in the second half of the year, validating the scenario of 2 monetary easings by the Fed between now and the end of the year.

The easing of rates is propelling gold towards $2,465: tonight, the ounce is surpassing its end-of-May record highs and is poised - barring unforeseen circumstances - to post its best-ever close ($2,425), with a margin of over +1%.


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