EGB/GILT: European....>

GERMAN T-BILL AUCTION RESULTS: EGB/GILT: European govies have trade weaker this

morning, unwinding some of last week's bull flattening. European equities have

inched higher, while oil has trade lower.

- Gilts have pushed lower with cash yields 1-2bp higher across the curve.

- Bunds have underperformed gilts with the curve bear steepening. Current

yields: 2-year -0.6852%, 5-year -0.6568%, 10-year -0.4439%, 30-year -0.0160%.

- OAT yields are up 1-3bp with the longer end similarly underperforming. The

2s30s spread is 2bp wider.

- BTPs have traded broadly inline with core EGBs. Cash yields are 2-3bp higher.

- Supply this morning came from Germany (Bubills, EUR5.6bn) and the Netherlands

(DTCs, EUR3.71bn).

- Focus this week will be on the ECB meeting on Thursday. Given the policy

package announced in June, no significant changes are expected this time around.

In light of comments made by Isabel Schnabel and Klaas Knott, expect questions

during the press conference on whether PEPP will be fully utilised.