FREELAND: CANADA WON'T ESCALATE OR BACK DOWN ON US TRADE FIGHT

MNI: PBOC To Aim To Drive Inflation Higher- Advisors

MNI: China To Issue More Bonds As Stimulus Targets Consumption

MNI: PBOC To Aim To Drive Inflation Higher- Advisors

MNI: China To Issue More Bonds As Stimulus Targets Consumption

MNI BRIEF: China Nov M1 Decline Narrows, M2 Slows

EZ/UK T-Bill Calendar: 8/13/28/50-Week BTF Auction on Monday

EZ/UK Bond Supply Calendar: 4.125% Jul-29 Gilt Due on Tuesday

MNI: CANADA OCT WHOLESALE SALES +3.3%; EX-AUTOS +0.5%

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

EGBs-GILTS CASH CLOSE: Rally Led By Short-End/Belly

BONDS

Gilts and EGBs rallied Friday, led by gains in the short-end and belly after US producer price data came in softer than expected.

  • Core FI rallied at the open, with some apparent focus on soft 3M/3M UK GDP and services data within a mixed report. The main event of the day though was US PPI which pointed to a softer core PCE inflation reading for December than Thursday's CPI alone implied.
  • This boosted rate cut expectations in the US which spilled over into Europe: implied ECB cuts this year ramped up 14bp on the session to 155bp, with BoE up 15bp to 136bp.
  • Periphery spreads tightened once again, with 10Y BTP/Bund at the tightest closing level since April 2022.
  • The German and UK curves bull steepened. 10Y German yields finished the week 2.5bp higher; Gilts were flat.
  • After hours, we get potential ratings decisions for the EFSF/ESM/Latvia/Austria; Monday's session will likely be quieter than usual given a US holiday, with attention next week on UK labour market/inflation data.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

  • Germany: The 2-Yr yield is down 10.9bps at 2.517%, 5-Yr is down 7.5bps at 2.078%, 10-Yr is down 5.2bps at 2.184%, and 30-Yr is down 3.1bps at 2.395%.
  • UK: The 2-Yr yield is down 9.5bps at 4.16%, 5-Yr is down 9.6bps at 3.661%, 10-Yr is down 4.9bps at 3.793%, and 30-Yr is down 1.6bps at 4.424%.
  • Italian BTP spread down 2.1bps at 155bps / Spanish down 1bps at 90.8bps
BulletMarketsFixed Income BulletsHomepage
BulletMarketsFixed Income BulletsHomepage

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.