EGBs/Gilts have traded quietly so......>

BOND SUMMARY: EGBs/Gilts have traded quietly so far, with Italy outperforming.

- German curve pretty flat so far; long end underperforming.

- Italian spreads continue to retrace lower; 10-Yr spread vs Bunds down 6.4bps

at 243.4bps. Corriere reported Sunday that in a letter to the European

Commission, PM Conte included a request to review the 3% of GDP deficit rule.

- Gilt futures up a few ticks; few real implications out of Sunday's

Conservative leadership debate, with frontrunner Johnson not in attendance.

- Pretty quiet data slate across Europe (just Eurozone labour costs at 1000UK),

though we get OLO supply from Belgium and Slovakia sells SLOVGBs.

- Slovenia was upgraded to AA- from A+ by S&P on Friday; France and UK affirmed

at AA and AAA, respectively.

- The highlights in terms of speeches include President Mario Draghi speaking in

Portugal as the ECB's Sintra conference gets underway.

- ECB`s Coeure saying in FT this morning that weak market signals are at odds

with decent econ data; that all easing options come with 'costs and benefits',

that tiering would have to be considered if policy rates are cut.