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EGBs-GILTS: Everything's Up

BOND SUMMARY

Bunds and Gilts have picked up Wednesday where they left off Tuesday with a bull-flattening rally, while periphery spreads are a little tighter.

  • The Global FI rally continues - indeed, almost all assets are stronger. Equities and commodities are up, and EUR and GBP slightly higher.
  • German industrial production in May came in lower than expected, but with higher revisions; Italy retail sales at 0900BST and European Commission's summer economic forecasts at 1000BST round out a morning of Tier 2 data (and no scheduled central bank speakers).
  • In supply, the UK sells GBP0.6bln of linkers and Germany sells E5bln of Bobl.
  • More attention on US Fed minutes, out well after the European close.

Latest levels:

  • Sep Bund futures (RX) up 17 ticks at 173.77 (L: 173.46 / H: 173.81)
  • Sep Gilt futures (G) up 11 ticks at 129.21 (L: 128.94 / H: 129.22)
  • Sep BTP futures (IK) up 20 ticks at 152.66 (L: 152.35 / H: 152.75)
  • Italy / German 10-Yr spread 0.5bps tighter at 100.7bps

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