EGBs-GILTS CASH CLOSE: BoE Delivers 75bp Hike, Long End Gilts Weaken

European bonds continued to weaken Thursday following the lead of a hawkish Fed late Wednesday, with Bunds outperforming Gilts at the long end, and vice versa.

• Along with today's largely-expected 75bp hike (with a 7-2 vote), the BoE meeting communications also suggested that the recent market implied peak rate of 5.25% was too high.
• The UK long end underperformed in a bear steepening move, with BoE's Ramsden noting that the bank could start selling longer-end Gilts in the new year.
• The German curve saw very slight bear flattening. MNI interviewed ECB's Kazaks who said the bank would probably have to continue hiking past March, while calling for the ECB to start rolling off its APP holdings in Q1 next year.
• Attention Friday is on the US Employment Report.

CLOSING YIELDS / 10-YR PERIPHERY EGB SPREADS TO GERMANY:

• Germany: The 2-Yr yield is up 10.3bps at 2.085%, 5-Yr is up 10.5bps at 2.128%, 10-Yr is up 10.4bps at 2.245%, and 30-Yr is up 7.2bps at 2.169%.
• UK: The 2-Yr yield is up 3.7bps at 3.095%, 5-Yr is up 8bps at 3.443%, 10-Yr is up 12.2bps at 3.521%, and 30-Yr is up 14.8bps at 3.719%.
• Italian BTP spread up 1.8bps at 217.4bps / Spanish down 1.6bps at 107.3bps