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EGB/GILT

BOND SUMMARY

Core European sovereign bonds have traded weaker this morning alongside modest gains for equities.

  • The gilt curve has steepened on the back of the short end trading firmer and the longer end selling off. The 2s30s spread is 3bp wider.
  • Bunds have sold off and the curve has marginally bear steepened.
  • OATs trade in line with bunds with cash yields 1bp higher on the day.
  • BTPs have inched higher from early trading with yields now marginally below yesterday's closing levels.
  • In response to the UK government's contentious internal markets bill, the EU has launched legal action against the UK for breaching the withdrawal agreement.
  • Supply this morning came from the UK (Gilts, GBP5.25bn), France (OATs, EUR11.5bn) and Spain (Bonos/Oblis/ObliEis, E3.83bn).
  • This morning's PMI prints were the final September releases.

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