BONDS: EGBs-GILTS CASH CLOSE: Curve Bellies Outperform As Gains Extend

Core European instruments extended gains to a 6th consecutive session Tuesday.

• After an slightly weak start to the day, Gilts and Bunds gained in afternoon trade on apparent global growth concerns, as broad-based weakness in commodities led by oil boosted safe-haven assets.
• Earlier, a largely in-line UK labour market report did not provide much to move expectations for the BoE, while final German CPI was inline.
• Curve bellies outperformed in Germany and the UK. Periphery EGB spreads were little changed.
• Most attention Wednesday will be on US CPI, but before that we get monthly UK activity data.
• Looking beyond that, a 25bps cut at Thursday's ECB meeting is unanimously expected (and priced in), leaving focus on the policy guidance and revised projections. (MNI's ECB preview is here.)

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is down 3.6bps at 2.178%, 5-Yr is down 4.1bps at 1.993%, 10-Yr is down 3.7bps at 2.131%, and 30-Yr is down 2.6bps at 2.406%.
• UK: The 2-Yr yield is down 2.9bps at 3.86%, 5-Yr is down 3.8bps at 3.685%, 10-Yr is down 3.7bps at 3.819%, and 30-Yr is down 2.6bps at 4.398%.
• Italian BTP spread unchanged at 145.2bps / Spanish bond spread down 0.2bps at 82.7bps