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10-Year Spread Vs. Bunds Back Toward Middle Of Recent Range Following CPI

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Several sell-side desks suggested taking profit on/lightening up gilt/Bund tightener positions earlier this week, given the proximity to today’s UK CPI data, the pre-CPI dovish move in GBP STIRs and prevailing spread levels.

  • 10-Year gilt/Bunds is ~9bp wider vs. Friday’s closing levels, back towards the middle of the multi-week closing range.
  • The spread last trades at ~171bp, with the bulk of the move coming in the wake of the firmer-than-expected UK CPI readings (~8bp wider today).
Fig. 1: 10-Year Gilt/Bund Spread (%)

Source: MNI - Market News/Bloomberg

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Several sell-side desks suggested taking profit on/lightening up gilt/Bund tightener positions earlier this week, given the proximity to today’s UK CPI data, the pre-CPI dovish move in GBP STIRs and prevailing spread levels.

  • 10-Year gilt/Bunds is ~9bp wider vs. Friday’s closing levels, back towards the middle of the multi-week closing range.
  • The spread last trades at ~171bp, with the bulk of the move coming in the wake of the firmer-than-expected UK CPI readings (~8bp wider today).
Fig. 1: 10-Year Gilt/Bund Spread (%)

Source: MNI - Market News/Bloomberg