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EGBs-GILTS: Inflation Focus

BOND SUMMARY

Futures are trading little changed on the session, with cash yields a little lower and periphery spreads mixed. Inflation data the focus.

  • Flash Eurozone /Italy Jun inflation data is the morning's focus (1000BST). Earlier saw French flash inflation in line with expectations; German unemployment declining more quickly than expected in June; while there was little change to UK GDP in the final 1Q reading.
  • In supply: Italy seeling E6bln of BTP, Latvia 7Y syndication underway. EFSF sent RfP for a transaction next week.
  • Speakers include ECB's Panetta (0900BST) and BOE's Haldane (1200BST).

Latest levels:

  • Sep Bund futures (RX) up 8 ticks at 172.15 (L: 171.98 / H: 172.21)
  • Sep Gilt futures (G) up 3 ticks at 127.99 (L: 127.86 / H: 128.05)
  • Sep BTP futures (IK) down 4 ticks at 150.72 (L: 150.56 / H: 150.8)
  • Italy / German 10-Yr spread 0.6bps wider at 105.6bps

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