Core EGBs have picked up a bid as.......>

EGB SUMMARY: Core EGBs have picked up a bid as equities have retreated Tuesday

afternoon, while Italian BTPs have soared in later trading.

- BBG reported that Italy`s government has lowered its 2019 GDP growth forecast

to 0.1% from 1.0% and raised its deficit target to 2.4% of GDP from 2.0%.

- This news (around 1310UK) appeared largely priced in due to prior media leaks.

- Ultimately, BTP Jun futures soared at 1530UK, hearing from market source of

300m buyer of 10Yr. Last up 60 ticks at 130.17, having traded up to 130.23.

- Jun Bund futures (RX) up 15 ticks at 165.51 (L: 165.11 / H: 165.64),

strengthening amid mid afternoon equity weakness.

- OAT futures up 22 ticks at 162.26. 

- Euribor strip fairly flat, Blues up 1-1.5 ticks.

- ECB meeting takes centre stage Wednesday - see our full Preview which was out

earlier: https://emedia.marketnews.com/ECB_Preview_April_2019.pdf

- Wednesday should prove more exciting: apart from the ECB decision, govvy

supply maintains its pace with up to E5bln total on offer, with Germany selling

Bobl, Portugal selling PGBs, and Finland selling RFGBs.