[MARKET ANALYSIS] T-note futures remain afloat after gaining yesterday on the subdued risk appetite

USTs: +3 ticks

• Holds on to recent gains after advancing across the curve amid the subdued risk appetite stateside and after a better-than-previous 7yr note auction, while there is little scheduled today for the US aside from PPI and Chicago PMI data.

Bunds: +14 ticks

• Remains firmer and approaches closer to retesting the 130.00 level, but with further upside capped ahead of several releases from Germany, including CPI, Import Prices and the Unemployment Rate.

JGBs: +19 ticks

• Continued to rebound from this week's trough as participants digested Tokyo CPI data, which printed firmer-than-expected, but slowed from the previous readings, with Core CPI in the capital region declining below the BoJ's 2% target for the first time since October 2024.

The U.S. Treasury (T-note) futures are experiencing a supportive environment due to subdued risk appetite, aided by a strong performance at a recent 7-year note auction. This mirrors trends in German Bunds and Japanese Government Bonds (JGBs), where rising prices underline market reactions to key inflation data. The upcoming U.S. Producer Price Index (PPI) and Chicago PMI will likely be pivotal in shaping expectations around future central bank policy.