EGBs-GILTS CASH CLOSE: UK Long End Blows Out As Brexit Deal Said Imminent

Long-end UK yields blew out Wednesday (5s30s rose the most since June) and German Bunds weakened alongside as the UK and EU appeared to be on the precipice of a Brexit deal as soon as today.

• Many headlines from multiple sources to that effect began in earnest around 1340GMT when the UK curve really began to sell off. MNI's Policy team reported "the EU and the UK seemed to be closing in on a post-Brexit trade agreement on Wednesday, though EU sources cautioned that a deal was still not in the bag."
• Elsewhere, Italy and Greece unveiled their 2021 funding plans; see our Bullets service for details.
• With little on the calendar on a holiday-shortened Thursday, all attention will be on Brussels and London to see if a deal finally crosses the line.

Closing Levels / 10-Yr Periphery EGB Spreads:

• Germany: The 2-Yr yield is up 3.2bps at -0.704%, 5-Yr is up 4.3bps at -0.719%, 10-Yr is up 4.8bps at -0.547%, and 30-Yr is up 4.8bps at -0.15%.
• UK: The 2-Yr yield is up 1.2bps at -0.121%, 5-Yr is up 6.9bps at -0.037%, 10-Yr is up 10.3bps at 0.286%, and 30-Yr is up 13bps at 0.863%.
• Italian BTP spread down 1.8bps at 113.2bps / Spanish spread down 2.4bps at 62.1bps