Free Trial

EGB/GILT: Reversing Early Losses

BOND SUMMARY

European government bonds initially traded weaker soon after the open, before then paring losses and trading above yesterday's close.

  • The gilt curve has bull steepened with the 2s30s spread 1bp wider.
  • UK public borrowing data came in better than expected for May (PSNBR GBP23.6bn vs GBP25.5bn expected) as the economic recovery gains ground, although the government is still looking into ways to bolster public finances with the Telegraph yesterday reporting that officials are looking into potential pension tax reforms.
  • Following the initial selling, bunds are now back to unch on the day with the curve flat overall.
  • OATs have mirrored the move in bunds with cash yields broadly 1bp lower.
  • Spain launched EUR8bn of a 10-year bond while the Netherlands sold EUR1.96bn of the 4.00% Jan-37 DSL.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.