Bund future hit session high just.......>

EGB SUMMARY: Bund future hit session high just before release of UK CPI data at

0930GMT and then spent the rest of the session fading lower. But the real story

has been in the 30-yr sector which has seen yields, especially in the periphery,

jump sharply higher, leading to 10s/30s curve of all EGBs to steepen.

- Spain and Italy 30-yr yields have risen by 8.8bp and 6.5bp respectively, while

French and Belgium are 4.2bp and 5bp higher and even German and Dutch 30-yr are

2-3bp higher. German 10-yr Bund yield is 1.5bp lower at 0.741%

- Speculation is that Spain will announce a new 30-yr syndicated deal, possibly

as early as next week. Belgium is still expected to launch a 15-20-yr Olo green

bond soon and Germany re-opens 2044 Bund tomorrow. While demand at Italy's 30-yr

BTP auction today was a little disappointing.

- There has been some decent swap flows seen today, mainly in the 10-yr and

above area which appeared to be flatteners with paying in 10s and receiving in

30s in the morning, only to change direction later on with some paying in the

long-end.