EGB/Gilt: Mixed Start To The Week

European government bonds have had a mixed start to the week, while equities are broadly higher and G10 currencies have gained ground against the dollar.

• Gilts have traded lower across most of the curve, although the very long-end has twist flattened.
• The bund curve has steepened with the 2s30s spread widening 4bp.
• OATs have traded below the Friday close, but lack clear direction. Cash yields are up to 3bp higher on the day.
• BTPs have rallied with the curve bull steepening. Cash yields are 3-10bp lower on the day with the 2s30s spread widening 5bp.
• The SPGB curve has twist flattened with the 2s30s spread narrowing 3bp.
• The euro area final PMI reading for July came in a touch better than initially estimated, while still pointing to a broad contraction in economic activity.
• Supply this morning came from Germany (Bubills, EUR4.261bn allotted) and the Netherlands (DTCs, EUR2.62bn). France will offer EUR4.8-6.0bn of BTFs this afternoon.
• Focus turns to US ISM manufacturing data for July, which will be published later today.