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EGBs-GILTS: Boris Intervention Sinks Gilts

BOND SUMMARY

A brief safe-haven rally for Gilts reversed on news that UK PM Johnson would be meeting w EU's von der Leyen on Saturday for Brexit talks.

  • Overnight of course we'd seen a bid in global core FI on the news that US Pres Trump tested positive for COVID.
  • Equities are finding some footing now but attention will be paid to further news from the White House and EU-UK negotiations, ahead of US nonfarms data later. Eurozone flash CPI will be eyed too, esp the core number (1000BST). Earlier, Spanish jobless numbers badly missed expectations.
  • ECB speakers include Holzmann, de Guindos and de Cos.
  • BTPs have spiked in early trade, looks order-related.

Latest levels:

  • Dec Bund futures (RX) up 12 ticks at 174.78 (L: 174.61 / H: 174.92)
  • Dec Gilt futures (G) up 6 ticks at 136.03 (L: 135.83 / H: 136.16)
  • Dec BTP futures (IK) up 36 ticks at 148.44 (L: 148.15 / H: 148.6)
  • Italy / German 10-Yr spread 1.4bps tighter at 134.3bps

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