Free Trial

EGBs-GILTS CASH CLOSE: Dovish Tone Continues

BONDS

Bunds and Gilts continued to bull flatten Wednesday, largely holding onto gains made in the morning (with further ECB-speak indicating a dovish stance on PEPP, today from Panetta). Periphery spreads basically unchanged.

  • In supply, Germany held a very weak (technically uncovered, 0.73x bid-to-cover) 15-Yr Bund auction, allotting E1.73bln; Italy sold E4.75bln of BTPei and short-term BTP.
  • Not much in data, though French May confidence indices beat expectations.
  • Ex-Gov't aide Cummings' testimony in Parliament on the govt's handling of the pandemic made for dramatic headlines, but little market impact.
  • Thursday sees several speakers (ECB's de Guindos/Schnabel/Weidmann, BOE's Vlieghe) and Italian and German confidence data but no bond issuance.

Closing yields/10-Yr Spreads to Bunds:

  • Germany: The 2-Yr yield is down 0.3bps at -0.666%, 5-Yr is down 2.4bps at -0.577%, 10-Yr is down 3.9bps at -0.206%, and 30-Yr is down 4.7bps at 0.349%.
  • UK: The 2-Yr yield is up 0.7bps at 0.023%, 5-Yr is down 1.9bps at 0.302%, 10-Yr is down 3.4bps at 0.752%, and 30-Yr is down 3.8bps at 1.282%.
  • Italian BTP spread up 0.1bps at 112.7bps / Spanish spread down 0.2bps at 65.8bps

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.