A good session for bonds, with rates continuing to ease.

Treasury bonds did not end the day at their highest, but the fall in yields was appreciable: -4.5pts on Bunds and OATs (to 2.538% and 3.027% respectively) and -5pts on Italian BTPs to 3.844%.

This morning, markets took note of a fall in unemployment in Germany in May, suggesting a possible slow recovery in growth. According to data published on Tuesday by the Federal Labor Office, the number of jobseekers fell last month by 27,000 to around 2.72 million in seasonally-adjusted figures.

In the US, the most eagerly awaited figure was the Jolts report (Job Openings and Labor Turnover Survey): the Labor Department counted 8.059 million job openings in April (March's figure was revised downwards to 8.355 million).
Tomorrow, investors will discover ADP's monthly survey of private-sector job creation.

US T-Bonds eased -6pts on US T-Bonds (to 4.330%), the third consecutive session of declines.)
The '30-yr' erased -6Pts at 4.4900%.


Markets should remain cautious until Thursday's announcement of the ECB's decisions, which will be followed by a much-anticipated press conference by its President Christine Lagarde.

The ECB's two-day meeting should conclude with a 25bp cut in key rates, bringing them down to 3.75% for the deposit facility.

However, investors will be paying close attention to any hint of a future rate path, given that inflationary pressures are only gradually receding on the Old Continent... and wage costs are likely to remain above +4% annualized by the end of the year.

Nevertheless, some strategists are expecting limited movements in the indices, given the ECB's usually cautious approach to its outlook.

The positive factor is the deflationary impact of the downturn in oil prices, with Brent North Sea crude (-1.5% to $77) confirming its decline below $80 a barrel, and dipping below $78 for the first time since February, despite OPEC+'s extension of its production limitation agreement.


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