Bond markets deteriorated sharply this week, but without prejudice to stock market indices, which fared very well (particularly in Europe), as if their assessment of the risk of inflationary resurgence were based on statistics that were watered down compared to those disseminated to fixed-income markets.

Yields have continued to tighten since last Friday (+15Pts on US T-Bonds), and Thursday's session was the most negative, with +10Pts in one go.
There's no relief on the horizon on this weekend eve, with T-Bonds down another +2pts to 4.315% (from a low of 4.04% on March 8), the same gap for our OATs (to 2.884%), then +2.2pts on Bunds (to 2.440%) and +3.2pts on Italian BTPs to 3.7100%.
Traders in Paris this morning took note of the French consumer price index for February, announced as a provisional estimate at +2.9% annualized after +3.1% in January.
Over one year, consumer prices in France rose by 3% in February 2024, according to Insee, which thus revised its provisional estimate (after having lowered its 'Q1' GDP expectation to 0.00% the previous day).

The week ends on a down note for 'Gilts', with +6Pts at 4.146%.

The US figures published throughout the week were disappointing, and this Friday's will not dispel the unease surrounding the recent inflation data.

US consumer confidence remained broadly stable in March, according to the index calculated by the University of Michigan, which came in at a preliminary estimate of 76.5, compared with 76.9 the previous month.

Although the index was down by 0.5% on February, this variation is well within the margin of error.

However, the index is up 23.4% on March 2023, and consumers are still alive and well, as demonstrated by Thursday's solid retail sales figures, accompanied by the strongest annualized rise in producer prices since September.

Of note - albeit an 'inconclusive' figure - was a sharp contraction in manufacturing activity in New York State in March, according to the local Fed's 'Empire State' index of general conditions: the index plunged 19 points on the previous month to stand at -20.9.

Demand weakened due to a significant drop in new orders and a decline in shipments", explain the surveyors, adding that labor market indicators also weakened.

The pace of input price increases moderated somewhat, while that of selling prices remained stable. Businesses expect conditions to improve over the next six months, although optimism remained subdued.
Finally, US import prices rose by 0.3% in February compared with the previous month (+0.2% excluding petroleum products), while export prices increased by 0.8%, both gross and excluding foodstuffs.

The 12-month picture is more encouraging: import and export prices fell by 0.8% (-0.5% excluding petroleum products) and 1.8% respectively last month (-1% excluding foodstuffs).

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