EGBs-GILTS CASH CLOSE: US Jobs Data Reverses Rally

European yields reversed sharply higher Friday afternoon as the highly anticipated November US employment report came in stronger than expected.

• 10Y Bund yields finished 10bp off post-Sept intraday lows; Gilts 15bp.
• Overall Gilts modestly underperformed Bunds; both the UK and German curves bear flattened sharply.
• EGBs held in relatively well, with spreads finishing mostly wider (though Greek spreads tightened again).
• Only limited reaction to late news that the EU had agreed a $60/bbl price cap for Russian oil exports (EUR and GBP jumped, though.)
• In European data, Oct saw a stronger-than-expected contraction M/M, but this masked an uptick in core.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is up 7.6bps at 2.105%, 5-Yr is up 6.7bps at 1.865%, 10-Yr is up 3.9bps at 1.853%, and 30-Yr is down 3.2bps at 1.687%.
• UK: The 2-Yr yield is up 7.3bps at 3.352%, 5-Yr is up 7.2bps at 3.281%, 10-Yr is up 5.3bps at 3.153%, and 30-Yr is up 9bps at 3.495%.
• Italian BTP spread up 2.5bps at 191.1bps / Greek down 2bps at 204.6bps