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EGBs-GILTS CASH CLOSE: Yields Fade Late

BONDS

German and UK yields faded lower toward the end of Friday's session, reversing most of the morning's initial rise. European curves flattened in sympathy with their US counterparts.

  • The US employment report was the most anticipated event of the session but came in almost exactly in line with survey.
  • Spanish and Italian PMIs came in weaker than expected; Eurozone inflation beat stale expectations, little discernable market reaction.
  • Periphery spreads widened; BTPs underperformed.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

  • Germany: The 2-Yr yield is up 0.6bps at -0.068%, 5-Yr is up 0.3bps at 0.378%, 10-Yr is up 0.7bps at 0.555%, and 30-Yr is up 0.6bps at 0.672%.
  • UK: The 2-Yr yield is up 2.2bps at 1.374%, 5-Yr is up 1.2bps at 1.417%, 10-Yr is down 0.2bps at 1.608%, and 30-Yr is down 2.6bps at 1.737%.
  • Italian BTP spread up 4.7bps at 153.8bps / Spanish up 2.9bps at 91.7bps

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