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EGBs-GILTS: Greece Underperforming Again Amid Issuance

BOND SUMMARY

Gilts and Bunds are a little stronger early Wednesday (both futures touching June highs). BTPs outperforming, with spreads tightening, potentially with some position squaring ahead of the ECB decision Thursday.

  • Greece 10-Yr Tap via syndication is the morning issuance highlight, MNI sees E3.0bln size (GGBs underperforming for a second consecutive session). Germany sells E1.5bln of Bund, UK sells GBP1bln of Gilt linker, Portugal sells up to E0.75-1bln of OT.
  • German Apr trade data out earlier (surplus a little lower than expected on weaker exports and imports growth) but little data otherwise, and no speakers.
  • ECB of course remains the week's focus - contact us if you haven't seen our preview.

Latest levels:

  • Sep Bund futures (RX) up 17 ticks at 172.27 (L: 172.08 / H: 172.32)
  • Sep Gilt futures (G) up 13 ticks at 127.61 (L: 127.46 / H: 127.66)
  • Sep BTP futures (IK) up 57 ticks at 151.33 (L: 150.84 / H: 151.42)
  • Italy / German 10-Yr spread 2.8bps tighter at 105.7bps

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