/EGBs-GILTS CASH CLOSE: Curve steepening......>

BONDS: /EGBs-GILTS CASH CLOSE: Curve steepening has been the order of the

afternoon, with supply concerns mounting on both sides of the Atlantic (US

quarterly issuance announcement, and new German 15-Yr launch among others, and

another day of sizeable EGB sales tomorrow too).

- German curve: 2-Yr yield is up 4.6bps at -0.745%, 5-Yr is up 5.5bps at

-0.718%, 10-Yr is up 7.1bps at -0.507%, and 30-Yr is up 7.9bps at -0.058%.

- BTPs ended the cash session with a thud, 2-Yr spread to Germany moving as much

as 13bps wider in the afternoon though just 2.4bps higher on the day. 10-Yr

spread drifted back toward highs (250bps vs Bunds), ended +3.7bps at 248.2bps.

- Weakness focused in 5s/10s. 2-Yr BTP yield up 7bps at 0.813%, 5-Yr up 11.1bps

at 1.388%, 10-Yr up 10.8bps at 1.975%, 30-Yr up 9.7bps at 2.788%.

- Other periphery EGBs: Spain/Portugal 10s out +1bps, Greece 8.3bps tighter.

- Gilts saw comparatively little change, with BoE decision early Thursday being

watched: 2-Yr yield is down 0.3bps at 0.008%, 5-Yr is up 1.2bps at 0.08%, 10-Yr

is up 2.5bps at 0.231%, and 30-Yr is up 1.1bps at 0.561%.