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The UK and German curves steepened over the course of Friday's session, reversing initial flattening. BTP spreads reversed most of Thursday's widening, with attention on Tuesday's Senate confidence vote that could decide the fate of the Conte government.

  • Stronger-than-expected UK GDP numbers added to the negative Gilt tone on the open, but apart from that there was little in the way of market-moving macro events / data / speakers.
  • Ratings reviews of the UK and Finland after hours Friday of some note.
  • Next week to see an estimated E21.5bln in EGB auctions, plus syndications (possibly Greece; while the EU has issued an RFP for its SURE bond).
  • We also get the ECB Governing Council meeting next Thursday.

Closing Cash levels:

  • German 2Y Yld +0.7bps at -0.72%, 10-Yr +0.7bps at -0.543%, 30-Yr +1.3bps at -0.133%
  • UK 2Y Yld -1.4bps at -0.134%, 10-Yr -0.3bps at 0.288%, 30-Yr +0.3bps at 0.868%
  • Italy/German 10-Yr Spread 3.6bps tighter at 115.7bps
MNI London Bureau | +44 203-865-3807 | tim.cooper@marketnews.com