Bunds have once again hit new highs,....>

EGB SUMMARY: Bunds have once again hit new highs, while EGB spreads are largely

unch on the day as further deterioration in US-China trade talks and USDCNY

moving above 7 see risk sentiment take another leg lower.

- This morning saw the release of the services PMIs with Spain and Germany

disappointing but Italy and France seeing positive prints, leaving the Eurozone

aggregate services PMI revised down 0.1 points to 53.2. There was little market

reaction to the release of the data.

- BTPs posted a particularly strong open, partly helped by reports in Repubblica

that early budget drafts had shown a 2020 budget deficit of less than 1.8% GDP.

However, spreads to Bunds quickly stabilised and are now little changed today.

- Bund futures are up 0.37 today at 176.19 with 10y Bund yields down -1.4bp at

-0.511% and Schatz yields down -1.0bp at -0.804%.

- BTP futures are up 0.18 today at 140.00 with 10y yields down -1.7bp at 1.523%

and 2y yields down -0.2bp at -0.2%.

- OAT futures are up 0.23 today at 168.03 with 10y yields down -0.4bp at -0.244%

and 2y yields down -1.4bp at -0.728%.