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Consolidating Off Richest Levels In The Main

EGBS

The outright EGB rally surrounding UK CPI has seen core & semi-core paper match/slightly lag the bid in German equivalents, leaving 10-Year spreads flat to a touch wider on the day, with the outright EGB bid generally fading from best levels. Bull steepening is in play on most of the curves, with ECB-dated OIS indicating a terminal deposit rate of ~3.95%, marginally softer on the day and back from dovish session extremes. Peripherals are mixed at the 10-Year point, digesting a marginal uptick in final Eurozone core Y/Y CPI for June. Solid demand at the latest 5-Year GGB auction has helped GGBs outperform. Portuguese 10s are little changed in spread terms, with BTPs (1bp) & SPGBs (0.5bp) a touch wider on the day. Macro headline flow remains light, outside of the UK CPI data.

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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