EGBs-GILTS CASH CLOSE: Weaker, With France Leading Spread Widening

European yields rose Tuesday, with risk spreads widening.

• While we heard from a few ECB speakers, including Centeno and Nagel, commentary didn't move markets, and there was little in the way of relevant macro data. Supply potentially weighed on the space, including syndications of E9bln of EU Bond and GBP4.5bln of Gilt linker.
• Both the German and UK curves bear steepened on the day, with Gilts modestly underperforming Bunds at the longer end of the curve.
• With French fiscal/political risk concerns appearing to re-emerge after Monday's post-election relief rally, OAT/Bund spreads are back at last Thursday's closing level after widening over 4bp.
• That led overall EGB spread widening, with periphery spreads up 1-2bp.
• Wednesday's calendar is highlighted by BoE speakers Pill and Mann, with the week's primary focus being Thursday's US CPI release (preceded by UK GDP).

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is up 1.8bps at 2.924%, 5-Yr is up 3.5bps at 2.562%, 10-Yr is up 4bps at 2.58%, and 30-Yr is up 4.2bps at 2.74%.
• UK: The 2-Yr yield is up 0.3bps at 4.128%, 5-Yr is up 3.5bps at 4%, 10-Yr is up 4.6bps at 4.159%, and 30-Yr is up 4.7bps at 4.664%.
• Italian BTP spread up 1.4bps at 136.2bps / Spanish up 1.4bps at 77.7bps