EGBs-GILTS CASH CLOSE: Mildly Bear Steeper To Start The Week

The German and UK curves bear steepened modestly Monday, with Gilts marginally underperforming as core FI failed to recover from losses at the open.

• European-specific catalysts were limited, with US data providing the biggest single market mover on a weak Empire State manufacturing survey. However, a pickup in corporate issuance helped keep a lid on nascent rallies.
• Periphery EGBs outperformed, led by GGBs- Greek legislative elections and Moody's review of Italy eyed in the coming weekend.
• There was little discernable reaction to BoE Pill's comments after the close (noted risk of second-round effects). ECB / BoE hike pricing was basically unchanged on the day, with 48bp and 45bp seen remaining in the respective tightening cycles.
• UK labour market data features Tuesday.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is up 1bps at 2.604%, 5-Yr is up 2.5bps at 2.246%, 10-Yr is up 3.3bps at 2.309%, and 30-Yr is up 5.1bps at 2.513%.
• UK: The 2-Yr yield is up 2.5bps at 3.826%, 5-Yr is up 2.7bps at 3.628%, 10-Yr is up 3.9bps at 3.817%, and 30-Yr is up 3.4bps at 4.25%.
• Italian BTP spread down 2.8bps at 187.7bps / Greek down 4.1bps at 170.4bps