EGB/GILT: In a ruling announced........>

BOND SUMMARY: EGB/GILT: In a ruling announced today the German constitutional

court called into question the ECB's QE purchases. The ECB has been given three

months to justify its purchases. According to Reuters, the ECB will discuss the

German court ruling at a non-policy meeting today at 1200ET/1700BST/1800CET.

- There was decent supply this morning from the UK (Gilts; GBP6.25bn) Germany

(linkers; E448.25mn), Spain (letras; E7.6bn), Belgium (bills, E2.2bn), the ESM

(bills, E2.5bn) and Austria (RAGBs; E1.15bn).

- Gilts trade close to flat on the day. Current yield levels: 2-year 0.009%,

5-year 0.080%, 10-year 0.227%, 30-year 0.559%.

- The bund curve has bull steepened with the 2s30s spread up 3bp.

- The short end of the OAT curve has firmed while yields at the longer end have

inched higher.

- BTPs have sold off sharply and led by the shorter end. The benchmark 2-year

has underperformed the curve with the yield up 16bp on the day.