Rates Weekly: The markets' hesitation is still favourable for bonds

EUR rates:Recap of the week:   Euro rates extended their February rally at the start of the week, with the 10Y Bund posting a tenth consecutive lower close as curves continued to bull-flatten. The move was driven less by fresh macro catalysts than by persistent duration demand in a low-volatility regime, supported by softer UK labor data and steady ECB messaging. Momentum faded mid-week after slightly hawkish FOMC minutes but attempts at bear-steepening lacked conviction and intraday ranges remained tight. Supply was absorbed without disruption despite mixed auction metrics, spreads stayed broadly stable.Tactical view: No major changes, the Bund is expected to trade in a narrow range near 2.80-2.90%, with external impulses remaining episodic and EGBs playing a key role in the new G10 sovereign investing paradigm; US Treasuries remain more uncertain, encouraging diversification of sovereign risk.Insight of the week: An outlook for OAT in 2026US rates:Treasuries trade poorly in the face of rising geopolitical risk regarding Iran; we continue to favor fading 4% in 10s though are cautious ahead of potential military action.  We also look at foreign investment into US Treasuries, where we find little evidence to date of foreign divestment from US Treasuries.