EGB/GILT: European govies have.........>

BOND SUMMARY: EGB/GILT: European govies have weakened across the board while

equities inch higher and oil posts further gains.

- The Bank of England's new forecast showed the economy contracting by 25% in

the second quarter, although the MPC opted against further easing at today's

meeting. 

- There was a large block of EGB supply this morning with France selling E11.1bn

of long-term OATs and Spain selling E7.1bn of Oblis/bonos as well as a linker.

- The gilt curve has bear steepened with the 2s10s spread widening 3bp on the

day.

- Bunds have weakened with cash yields up 2-3bp and the very long end of the

curve marginally steeper.

- French OATs which rallied following this morning's auction, leaving yields

just 1-2bp higher on the day.

- BTPs have sold off across the curve with marginal underperformance at the

short and long ends.