EGB/GILT

European govies have started the week on a looser footing and have unwound some of last week's bull flattening. Markets have pivoted to a risk-on position more broadly with the dollar on the backfoot against the G10 and equities inching higher.

• Gilts trade weaker with cash yields broadly 1bp lower across the curve. The Dec-20 gilt future trades at 136.37 - towards the bottom of the morning range (L: 136.33 / H: 136.58).
• Bunds trade close to unch on the day. Last yields: 2-year -0.7824%, 5-year -0.8013%, 10-year -0.6135%, 30-year -0.1938%.
• OATs have underperformed relative to bunds, particularly at the longer end where cash yields are 2bp higher on the day.
• BTPs have sold off sharply at the curve has bear steepened. The 2s30s spread is 4bp wider.
• Supply this morning came from Germany (Bubills, EUR2.93bn), Netherlands (DTCs, EUR1.08bn), Belgium (OLOs, EUR1.80bn), and Slovakia (SlovGBs, EUR478mn).
• The data calendar is light today, although there is a strong slate of central bank speakers from the ECB (Pablo Hernandez de Cos, Mersch, Lagarde, Lane) and the BoE (Broadbent, Cunliffe).