Snapshot: The German Index has cleared the historic 25,000 milestone, driven by Eurozone and German HICP both landing at the ECB’s 2.0% target, giving Philip Lane a clear runway to strike a dovish tone in his address today. Domestic momentum is amplified by corporate action, with Commerzbank rallying 1.6% on Berlin’s rejection of UniCredit’s hostile approach, and GEA Group surging 5% following a broker upgrade. While easing energy worries support the broader tape, the domestic disinflation narrative remains the primary engine of today’s leg higher.
- Key Level: Holding above the structural 25,000 handle shifts near-term targets to 25,180, underpinned by the structural collapse in German HICP from 2.6% to 2.0% which solidifies the ECB easing cycle.
- NY Session Watch: The 08:30 NY macro data print could trigger US yield volatility; a further backup in the US 10Y real yield beyond 2.17% risks capping progress in rate-sensitive German autos and tech, which have lagged the broader industrial bid.
Bias into NY: We are buyers of dips above 24,950 targeting 25,150, as the return of German inflation to the 2% target establishes a sovereign policy cushion that should easily withstand any temporary volatility from the US session.