Rates Weekly: Clarifications from central banks to come

EUR rates:Recap of the week:  Euro rates consolidated within tight ranges this week, with the 10Y Bund anchored around 2.55-2.60% amid easing trade tensions and contained volatility. The S&P downgrade of France had limited impact on French bonds, maintaining the 10Y OAT-Bund at 80bps, while renewed US sanctions on Russia briefly steepened curves.Tactical view:  We are approaching "central bank week," featuring the Fed, ECB, BoC, and BoJ. We maintain a neutral bias on directional and are waiting for more clarity from the US.  Our year-end target for the 10Y Bund at 2.80% remained unchanged, but we recognise that the risk is skewed to the downside. On the front-end, there are few expectations for next week's ECB meeting. Our positioning index suggests that the market remains neutral on DU (Schatz future). We do not expect significant steepening into year-end, the 10s30s is likely to stabilise around current levels. 10Y Bund ASW spread is stabilizing toward 0bp. Our year-end target of -5bp may hold if the market shifts its focus over the next month to the upcoming supply in early 2026. Regarding OAT, in the near term, the spread may stabilise or tighten slightly, supported by a negative net-supply over the next five weeks. However, we keep a neutral bias as we see some re-widening factors. On sovereign spreads, we continue to expect OLO vs. BTP convergence.Insights of the week: U.S. money market dynamics and Federal Reserve policy implications.