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EGBs-GILTS: Edging Higher Pre-Supply, ECB

BOND SUMMARY

Some bull flattening in both the UK and German curves, with periphery spreads slightly wider to open Thursday's trade. Fairly modest volumes thus far however.

  • The upcoming ECB decision is in focus: 1245BST release, 1330BST press conference. Meeting's expected to be a low-risk event, w focus on the pace of weekly PEPP purchases.
  • In supply, Spain sells up to E6bn of Bono/Obli, and France E11bn of nominal and E2bn of linker OAT.
  • Limited data slate: French confidence report earlier showed weakening in Apr vs Mar but was slightly better than expected.

Latest levels:

  • Jun Bund futures (RX) up 25 ticks at 171.13 (L: 171 / H: 171.27)
  • Jun Gilt futures (G) up 21 ticks at 128.88 (L: 128.8 / H: 128.93)
  • Jun BTP futures (IK) up 9 ticks at 148.4 (L: 148.39 / H: 148.65)
  • Italy / German 10-Yr spread 0.8bps wider at 102.3bps

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