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EGB/GILT: Periphery-core spreads.......>

BOND SUMMARY
BOND SUMMARY: EGB/GILT: Periphery-core spreads have widened, with this morning's
Italian and Spanish supply being a contributing factor. In addition, today's
flash PMI data for the eurozone (which captures the yet to be released
Italian/Spanish prints) for May was better than expected.
- Bunds have firmed with yields now close to unch on the day. Current yield
levels: 2-year -0.6896%, 5-year -0.6700%, 10-year -0.4770%, 30-year -0.050%.
- OATs have trade weaker with cash yields broadly 1-2bp higher.
- Supply this morning came from the UK (gilts: GBP1.25bn & treasury stock:
GBP2.0bn), Spain (bono/obli: E7bn) and Ireland (bills: E0.75bn). 
- The new BTP Italia as been offered to institutional investors today with
orders topping E19bn. BTP yields have pushed higher by 2-6bp and the curve has
bear flattened.
- Longer-end supply has contributed to bear steepening for the Spanish curve
with the 50-year benchmark yield up 5bp. 

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