BONDS: EGBs-GILTS CASH CLOSE: Long-End Fully Reverses Jackson Hole Rally

European curves bear steepened Tuesday, as last Friday's rally continued to reverse.

• Weakness across European FI had no single obvious catalyst, with higher natural gas prices and bond issuance cited as factors.
• UK yields jumped from the open in the return from Monday's holiday closure, with Bunds weakening in steady fashion throughout the day, continuing the prior session's weakness.
• This left longer-end yields above levels seen just before last Friday's dovish Jackson Hole speech by Fed Chair Powell.
• Short-end yields have retained some of their fall, however: BoE Gov Bailey's comments at Jackson Hole last Friday pointed to a "steady" course, seemingly downplaying potential for sequential cuts. 
• Periphery EGB spreads widened. BTPs were notable underperformers, with supply apparently weighing (Short-Term sales today, M-T/L-T auction Thursday).
• Wednesday's schedule includes French consumer confidence data and the ECB's monthly Eurozone monetary developments report, as well as a speech by BoE's Mann.
• The main focus of the week remains Eurozone inflation data on Thu/Fri.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is up 0.6bps at 2.404%, 5-Yr is up 2.4bps at 2.186%, 10-Yr is up 4bps at 2.288%, and 30-Yr is up 5.4bps at 2.537%.
• UK: The 2-Yr yield is up 4.3bps at 4.109%, 5-Yr is up 5.4bps at 3.911%, 10-Yr is up 5.9bps at 3.998%, and 30-Yr is up 6.1bps at 4.51%.
• Italian BTP spread up 3.2bps at 138bps  / Spanish up 1.9bps at 81.8bps