EGBs & Gilts Back From Best Levels

U.S. dynamics have generally dominated in recent trade, with typically hawkish Fedspeak from Mester, the previously outlined firmer than expected retail sales control group print and Pfizer kicking off jumbo 8-part $ issuance feeding through. Also note delta hedging surrounding the pricing of the syndication of the new Belgian Jun-43 OLO and syndication of the new UK Oct-63 Gilt will have added some pressure, with the same holding true for pricing of SSA € deals.

• Arch ECB hawk Holzmann also stuck to script.
• Bund futures are -15 on the day, with the major German cash benchmarks running cheaper across the curve, bear flattening.
• EGBs are flat to a touch tighter vs. German at the 10-Year point.
• Gilts are still outperforming in lieu of the softer than expected domestic labour market data, leaving futures +25 or so and the major cash benchmarks running richer on the day, bull steepening, but off best levels.