Treasuries rallied overnight, with the curve lower by about 3 basis points this morning, as growing fears surrounding the escalation in trade rhetoric between the world’s two largest economies. President Trump asked the Treasury to identify $200 billion in Chinese goods to place tariffs on, and China responded that it will act “forcefully”.
In Europe, the ECB hinted that rates may stay where they’re at beyond the summer of 2019 depending on how the data shakes out; which pushed the Euro lower. The pound also dropped due to Prime Minister May facing a contentious vote surrounding whether or not Parliament will have the power to direct the last stage of Brexit negotiations.
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