By Michael Read, Bloomberg Markets live commentator and reporter

Big moves in high volumes — that’s where we are at so far today. Eurodollar futures are down 20-23 ticks in the red pack and 17-19 ticks in greens, with volumes over 200% of the 7-day average during the last five hours of trading. Spicy.

In UST futures we have seen numerous block trades print throughout the European morning — seven blocks of ~5k with the latest being 4.99k TY at 116-01 (7 am) and 5k TY at 116-03 by my tally. Elsewhere, 3m dollar Libor fixed 8.41bp higher at 1.82886% — the largest rise since Feb. 11.

Friday’s CPI print gave markets little option but to really latch on to the need for far more aggressive tightening by the Fed and ECB, and we’ve a significant follow through today. I sometimes wonder whether the US 10-year yield would be trading near 3.25%, and we would be seeing daily double digit cheapening across the bond space, if Jim Bullard had gotten his way over front-loading hikes.

Perhaps a more aggressive tightening first, then a more laid-back approach would have been the right path; perhaps Covid concern in China and the broader supply-chain picture would lead to the same outcome regardless.

We seem to be trading like it’s a race to see which central bank can crash their respective economies the fastest: taming inflation clearly supersedes any central bank inflicted damage to the real economy.

What we can say is that the fact that markets are pricing rate cuts in 12-18 months out might be a sign of just how precarious things are, and the runway for a “soft-ish landing“ is getting shorter.