German bunds slip slightly before G-20 Summit kickstarts; eyes on eurozone’s June CPI

The German bunds suffered during European trading session Wednesday ahead of the country’s and eurozone’s consumer price inflation (CPI) data for the month of June, scheduled to be released on June 27 and 28 by 12:00GMT and 09:00GMT respectively.

The German 10-year bond yields, which move inversely to its price, traded tad nearly 1 basis point higher at -0.296 percent, the yield on 30-year note surged 1-1/2 basis points to 0.284 percent and the yield on short-term 2-year remained flat at -0.717 percent by 10:10GMT.

After national surveys released earlier this week suggested that firms and households are becoming more downbeat in Germany while the opposite is the case in France, the Commission’s full business and consumer survey results for June are due today.

And with Markit having reported that its flash PMIs implied that growth in activity beyond the Big Two member states slowed to the weakest since 2013, the Commission’s headline euro area Economic Sentiment Indicator is expected to fall back somewhat after rising for the first time in eleven months in May, Daiwa Capital Markets reported.

Today also brings the first indications of June inflation with the flash estimate from Germany due around lunchtime.  The annual CPI rate on the EU-harmonised measure is expected to remain unchanged at May’s thirteen-month low of 1.3 percent y/y. But the equivalent Spanish number released earlier this morning fell a larger-than-expected 0.3ppt to a 2½-year low of 0.6 percent y/y, with lower prices of electricity and fuel cited by Spain’s Statistical Agency as the driving factor, the report added.

Meanwhile, the German DAX traded tad -0.14 percent lower at 12,226.21 by 10:20GMT, while at 10:00GMT, the FxWirePro's Hourly Euro Strength Index remained neutral at 37.16 (higher than +75 represents bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex