- One weak US payrolls number does not change the big picture, and one big inflation print tomorrow will likely not also.
- It will confirm a big rise in prices in the past year though. That's a clear outcome, but the Fed needs more - a string of them.
- This is a bond market that has indeed built an inflation discount. At the same time, it's a bond market that is discounting quite a poor medium-term growth outlook (negativerealyields).
- The rise in euro rates has been larger in recent weeks, even though the oomph is US-driven.
For further details see:
Rates Spark: Outcome-Based