EGBs-GILTS CASH CLOSE: Gilts Outperform In Broad Relief Rally

Gilts strongly outperformed Bunds Friday amid a broader reprieve for core global FI, following Wednesday's US inflation data. Periphery spreads widened, led by Italy.

• With no bond supply, or key data or speakers, the broader risk tone (less fearful of an inflation surge) set the stage for a retracement lower in yields vs the past couple of sessions.
• Equities rose sharply and the euro and pound strengthened.
• MNI published an Exclusive talking to ECB sources on an upcoming Strategy Review meeting.
• After hours Friday sees ratings reviews: Fitch on Portugal, S&P on Netherlands.

Closing yields/10-Yr Spreads to Bunds:

• Germany: The 2-Yr yield is up 0.2bps at -0.656%, 5-Yr is down 0.8bps at -0.52%, 10-Yr is down 0.9bps at -0.129%, and 30-Yr is down 0.3bps at 0.434%.
• UK: The 2-Yr yield is down 2.3bps at 0.08%, 5-Yr is down 2.9bps at 0.38%, 10-Yr is down 4.1bps at 0.857%, and 30-Yr is down 4.1bps at 1.397%.
• Italian BTP spread up 2.3bps at 120bps /Spanish spread up 0.8bps at 71.4bps