The comments from Villeroy are reverberating through global bond markets. You can see here how Italian 10-year BTP yields are quickly moving lower and now down 9 bps on the day to 0.667%.

It’s spread globally as well (to some extent) with US 10s now up just 0.5 bps to 1.41%.

Of course, we continue to await the signal from the Fed.

Here’s the agenda for today:

The conference is hosted by the NY Fed and Williams will be delivering opening and closing remarks at the event. His opening speech is expected to be for 5 minutes only as the event will cover “Diversity, Equity & Inclusion and Culture”. Not quite the stage for specific policy remarks but just take note in any case.

Brainard will be speaking for about 30 minutes at the annual IIB conference, where the event will cover on “the most pressing issues facing the international banking community in the United States”. This doesn’t exactly fall in the realms of policy talk but given recent developments, she might make offer up a couple of remarks.

There is a lot going on with this one as it involves different timings, but the event itself begins at 1900 GMT and will stretch on to 2100 GMT. Bostic, Mester, Kashkari will all be participating as moderators for some discussions and be part of the panel themselves in a separate discussion at 2040 GMT. The agenda can be found here, with the event covering “Racism and the Economy: Focus on Housing” – discussing ‘policy proposals for dismantling the deep inequities in housing market valuation, mortgage lending, and patterns of housing development’. Not really the stage for policy talk but just take note in case.

At the start of European morning trade, it was holding around 1.40%. Meanwhile, 30-year yields are up by over 7 bps on the day and closing in on 2.23%.

Despite the market keeping the calm and equities are firmer so far, this remains a key spot to watch in case it causes negative spillovers like what we saw last week.

For now, US futures are hoping that ignorance is bliss but we will see how Wall Street takes to this in the session ahead. As mentioned earlier, if it starts to become a little messy, things can turn pretty quickly in the other direction today.

The index constituents are expected to gradually increase to 80 through regular reviews by mid-2022 and be fixed at 100 ultimately.

Other changes that will be adopted, via Bloomberg:

The 8% weightage cap will lessen the impact of Tencent and HSBC slightly but those two are likely to still be the dominant shares in the index for a while.

Italian 10-year yields are now down 8 bps to 0.69% while Germany 10-year yields are down 5 bps to -0.31% in European morning trade.

This goes against the backdrop of Treasury yields pushing a little higher so far on the session, with 10-year yields up from 1.40% earlier to 1.43% currently.

Going back to Europe, perhaps the ‘invisible hand’ i.e. ECB intervention is what is helping to exude calmer tones in the market. That is something to consider after policymakers had talked up the potential to accelerate PEPP purchases if need be.

We already also saw the RBA double-down on QE today to try and address the issue while the BOJ also offered a bit of a warning earlier in the session here.

The ball is now in the Fed’s court as to whether they will mention anything this week, with Powell’s speech on Thursday going to be a key one to watch.