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Realistbear

E C B Remains Hawkish While B O E Remains Dovish

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http://uk.biz.yahoo.com//21062006/94/bond-...on-trichet.html

Wednesday June 21, 03:13 PM

Bond markets turn their attention to Trichet

Government bonds in the UK and Europe moved in opposite directions
on Wednesday morning as hawkish comments from the president of the European Central Bank contrasted with relief over the minutes of the most recent Bank of England rate committee meeting.
Jean-Claude Trichet at the ECB signalled that interest rates would rise further to battle inflation in a speech to a European Parliamentary committee.
His comments followed strong consumer spending data from France, which showed that purchases of household goods had risen at their fastest pace in more than 20 years.
:o
European government bonds were hurt by these two pieces of information with traders increasing bets that their would be at least two more rate rises this year.
The yield on the two-year Schatz rose 1.4 basis points to 3.470 per cent, while that on the 10-year bund was 0.5bp higher at 4.002 per cent.
In the UK, gilt prices rallied a touch after the minutes of the June BoE rate-setting committee meeting showed that only one member had voted for an increase in rates with the seven others voting for the status quo.
There had been fears that two members could have voted for a rise following some strong recent economic data.
The rally in gilts was limited after Tuesday’s stronger than expected data on the UK housing market.
The yield on the two-year gilt slipped just 0.6bp to 4.829 per cent, while the yield on the ten-year was 1.4bp lower at 4.705 per cent.

Looks like Gordon has got the message out: there will be no IR hikes while I am awaiting ascendancy to No. 10.

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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