Core EGBs are lower while BTP...........>

EGB SUMMARY: Core EGBs are lower while BTP weakness has resumed (albeit spreads

are not significantly wider), with US jobs data eyed later.

- The Dec 18 Bund future is down 23 ticks at 157.81, nearing Thursday`s low of

157.74. The curve is slightly steeper: The 2-Yr yield is up 0.7bps at -0.51%,

5-Yr is up 2bps at -0.028%, 10-Yr is up 1.9bps at 0.55%, and 30-Yr is up 2.1bps

at 1.148%.

- Italian bonds are lower, with more typically bombastic comments from Deputy PM

Di Maio this morning, and news that ECB President Draghi met with President

Mattarella on Wednesday, potentially to warn on the budget, per La Stampa.

- Dec 18 BTP future down 35 ticks at 121.82, the 2-Yr yield up 7bps at 1.271% 

and 10-Yr yield up 2.1bps at 3.35%. However weaker Bunds means the 10Yr spread

is up just 0.2bps at 280bps.

- Periphery EGBs still hanging on, Spain 10s/Bunds in 2bps at 102bps, Portugal

in 1.1bps at 137.1bps, and Greece roughly flat at 396.3bps

- Germany Aug factory orders came in strong (2% M/M vs 0.8% M/M est).

- ECB's de Guindos and Knot speaking later.