[MARKET ANALYSIS] USTs and Bunds off worst levels as energy benchmarks dip from overnight highs

Gilts underperform heading into the 10:00BST speech from PM Starmer, see the 08:54BST analysis for more. Fixed generally on the backfoot as energy benchmarks opened higher and extended at the start of the week as the negotiating process made no progress on the weekend, with the US and Iran essentially rejecting each other's positions. We now await any revised proposal(s) before looking to the meeting between Chinese President Xi and US President Trump, from Wednesday. USTs hit a 110-15 low, with downside of just under 10 ticks, early doors. Since, as the energy space wanes from highs, fixed income has lifted off worst. USTs are now lower by around five ticks and to a 110-23 peak. If the upside continues, we look to resistance at 110-28 and 111-03+ from Thursday and Friday, respectively. Bunds in-fitting with USTs. Lower by 35 ticks to a 125.35 base early doors. Since, as energy eases, Bunds have trimmed much of the initial pressure and hold off a 125.56 peak, lower by c. 10 ticks. The schedule today is a little light, and as such, we are primarily awaiting updates on the state of negotiations between the US and Iran.