Core EGBs are holding firm against a....>

EGB SUMMARY: Core EGBs are holding firm against a backdrop of intensifying

global trade headwinds.

- German bund current yield levels: 2-year -0.657%, 5-year -0.521%, 10-year

-0.109%, 30-year 0.536%.

- The French OAT curve has flattened slightly on the back of the long-end

outperforming. The 2s10s spread has narrowed ~2bp.

- The stability of the Italian coalition continues to be tested as Matteo

Salvini and Luigi Di Maio appear to publicly disagree on policy. Earlier in the

day Savlini suggested he could become Italy's Donald  Trump, while Di Maio

warned that pursuing a right-wing policy agenda could lead to a clash between

the coalition partners. This has been largely shrugged off by BTPs, which have

rallied sharply. The 2-year benchmark yield is down 11bp on the day, while 2s30s

has widened 6bp.

- Today's final Eurozone inflation print for April was inline with consensus

(1.7%), while core was a touch stronger than expected (1.33% vs 1.2% survey).