Eurozone periphery bonds jump in silent trading ahead of benchmark German CPI

The Eurozone periphery bonds jumped Wednesday in a silent trading session that witnessed data of little economic significance. Also, the German and Eurozone consumer price inflation indices, scheduled for release on July 28 will add further direction to the debt market.

The benchmark German 10-year bond yields, which moves inversely to its price, slipped 1/2 basis point to 0.56 percent, the French 10-year bond yields also slipped 1/2 basis point to 0.81 percent, Irish 10-year bond yields slumped nearly 2 basis points to 0.86 percent, Italian flat at 2.13 percent, Netherlands 10-year bond yields traded tad lower at 0.68 percent, Portuguese equivalents flat at 2.97 percent while the Spanish 10-year yields traded 1-1/2 basis points higher at 1.56 percent by 09:20GMT.

Today’s data flow in the euro area sees the focus shift to households, with the release of the latest national consumer confidence survey results from France and Italy. In June, as Macron enjoyed an initial honeymoon period, the respective survey suggested that French consumers were the most upbeat for a decade.

But this morning’s figures showed that consumer confidence took a step down in July, with the headline survey indicator falling from 108 to 104 – still the second-highest reading this year – as respondents assessed their personal financial situation and standard of living to be less favourable, perhaps not unrelated to Macron’s announced plans to cut government spending, which has been particularly ill-received in certain quarters (e.g. among local governments and the military).

Nevertheless, the survey’s index of willingness to make major purchases remained stable at a multi-year high, suggesting that consumer spending should remain the principal source of French economic growth over the near term.

Meanwhile, the pan-European STOXX 600 index traded 0.54 percent higher at 382.80, German DAX climbed 0.39 percent to 12,312.50, France’s CAC 40 jumped 0.76 percent to 5,200.00 while the PSI20 Index traded 0.12 percent lower at 5,277.53 by 09:40 GMT, while at 09:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at -49.03 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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