[MARKET ANALYSIS] Fixed contained once again into US PPI

Once again, a contained start for fixed income. Major macro updates relatively light, and nothing that changes the narrative for the complex. Today, the focus is on US PPI for July, which will inform/update the calls ahead of PCE after Wednesday's CPI; as a reminder, the series sparked a modest dovish reaction in near-term Fed pricing. Since, that has extended. Pre-data, September was near a coin-flip between a hike and a hold. After the data, it edged marginally in favour of a hold. At the time of writing, CME FedWatch implies a 64% chance of a hold, significantly higher than the 45% implies this time last week (i.e. pre-NFP). USTs flat in 108-15 to 108-23 parameters, looking to PPI as mentioned before Fed's Barkin (2027) and Hammack (2026), and while both have spoken recently and updated view post-CPI will be pertinent. Bunds in-fitting with the above, newsflow for the bloc has been and is scheduled to remain light. Currently a few ticks firmer in 124.65-83 parameters. A similar picture for Gilts, with no lasting reaction at the open to the morning's GDP series which, in short, was stronger-than-expected for the GDP components aside from an in-line Q2 Q/Q print. However, the series is caveated by a weaker-than-expected breakdown for June and downward revisions to the May GDP series. Overall, the UK data does not change the extended hold narrative for the BoE. However, it does work in favour of those who raised dovish points at the last gathering.