The lower bond yields today is helping to see the dollar keep more sluggish to start European trading. At the same time, equities are also keeping slightly higher on the day. However, it’s tough to read much into it when everything could still change after we get to the US CPI data later.
That is still the key risk event for markets today as highlighted here. The bond market will be the main spot to watch as it will have reverberations to broader markets. For now, yields are nudging lower but it’s too early to make any calls that it will keep that way before the day ends. That being said, it will be a tall order to continue the price action from last week – especially up against a market that will hang on to anything to keep the disinflation narrative running.