Free Trial

EGBs-GILTS CASH CLOSE: BTPs Can't Quite Break Through

BONDS

Core FI rallied strongly in the afternoon for the 2nd time this week after softer than expected US data - Wednesday it was CPI, today a very weak UMichigan consumer sentiment survey.

  • Bunds and Gilts had been strengthening with bull flattening going into the 1500BST release, but yields extended to session lows following, and closed not far off.
  • Outside of that, the main source of price intrigue was in Italian 10Y BTP spreads, which tested 100bp vs Bunds (99.5bp session low - Jun 17 low of 98.1bp would be next up).
  • Relatively light volumes befit a nearly blank events calendar. French and Spanish Jul CPI final readings came in more or less unchanged from flash, and only supply was UK bills. No ECB/BoE speakers either.
  • Tonight sees ratings reviews of Ireland (Moody's) and Belgium (DBRS), but a limited slate early next week (no major data, supply or speakers Monday).

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

  • Germany: The 2-Yr yield is up 0.7bps at -0.739%, 5-Yr is down 0.6bps at -0.73%, 10-Yr is down 0.7bps at -0.467%, and 30-Yr is down 1.5bps at -0.022%.
  • UK: The 2-Yr yield is down 1.9bps at 0.136%, 5-Yr is down 1.8bps at 0.295%, 10-Yr is down 2.8bps at 0.573%, and 30-Yr is down 2.6bps at 0.961%.
  • Italian BTP spread up 0.9bps at 101.3bps /Spanish spread up 0.4bps at 68.6bps

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.