BTPs are getting hit after Rome.........>

EGB SUMMARY: BTPs are getting hit after Rome defied Brussels Tuesday in the

ongoing Italian budget conflict, while Bunds are a bit stronger.

- Italian yields and spreads hitting November highs after the government refused

to change its macro/deficit forecasts in its EC submission.

- The Dec 18 BTP future is down 79 ticks at 120.93, albeit off 120.59 low. 2-Yr

yield up 9.1bps at 1.114%, 10-Yr up 8.1bps at 3.527%.

- 10-Yr spread v Bunds is up 9.6bps at 313.3bps, with Greece up 7.3bps at

411.9bps (Spain and Portugal out 2.9bps each).

- Bunds advancing, with Dec18 future up 15 ticks at 160.23, albeit near day`s

lows (160.21). 10-Yr outperforming, yield down 1.5bps at 0.394%. 

- A Brexit showdown between UK PM May and her Cabinet in London also not helping

European risk appetite.

- In line with the slowdown in Germany (-0.2% Q/Q), Euro Area GDP is pencilled

in for a decline to 0.2% q/q from 0.4% in Q2.

- BBK Board member Claudia Buch and Joachim Wuermeling speak regarding the

Financial Stability Report 2018 in Frankfurt at 1000GMT.