Citi notes EUR/GBP flows and fundamentals diverge amid gilt buying - Investing.com UK

Citi, Deutsche Diverge on Euro-Dollar Trades - Pound Sterling LIVE

UK assets markets starting to feel the heat

UK asset markets are under increasing pressure amid rising bond yields and heightened concerns regarding economic stability. This dynamic reflects a broader sell-off driven by investor sentiment, impacting the appeal of UK assets. Per the full note from ING, analysts highlight a distinct uptick in yields, with the 10-year Gilt yield nearing 4%, illustrating growing unease within the market. Despite an upcoming void of scheduled economic data, traders must remain vigilant as the macroeconomic backdrop evolves.

GBP/USD: Diverging Central Bank Policies Keep the Pound Under Pressure - Investing.com

European Rate Markets: Eurobonds, by-elections and the spring statement

The desk is positioning for a bullish outlook on Eurobonds, driven by recent political developments and upcoming fiscal announcements in the UK. Per the full note from J.P. Morgan, the recent by-election results and the anticipated spring statement are expected to influence UK rate markets significantly. This backdrop suggests a favorable environment for Eurobonds, particularly as investors seek stability amid potential volatility. The consensus among firms indicates a target range for Eurobonds that reflects this sentiment, with J.P. Morgan's own target at 1.10 for March 2026.