[MARKET ANALYSIS] Treasury futures rally as the US-Iran ceasefire and slump in oil ease inflationary pressures
USTs: +20.5 ticks
- Surged higher as yields and inflationary pressures were eased by the double-digit drop in oil following the US-Iran ceasefire announcement, while participants look ahead to a 10-year auction stateside and FOMC Minutes.
Bunds: +137 ticks
- Rallied as markets were relieved by the ceasefire agreement and with Iran to allow safe passage through the Strait of Hormuz, while Eurozone Retail Sales and a EUR 5bln Bund issuance loom.
JGBs: +31 ticks
- Followed suit to the advances in global peers but is off today's best levels following stronger-than-expected Labour Cash Earnings for Japan.
Context
The announcement of a US-Iran ceasefire is boosting Treasury and Bund prices as it alleviates inflationary fears, particularly with a sharp decline in oil prices. This relief in geopolitical tensions could positively influence the broader risk environment, while the market anticipates upcoming economic data including the 10-year auction and FOMC Minutes.
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