EGBs/GILTs: It is slightly risk off....>

BOND SUMMARY: EGBs/GILTs: It is slightly risk off heading into today's ECB

meeting where consensus expects no major change in policy. 

- Among the minority of analysts expecting a change in policy, an expansion to

the PEPP is the most likely outcome.

- Data published this morning reveal a deeper than expected economic contraction

during the first quarter for France and Spain while the change in the level of

German unemployment in April similarly smashed through expectations.

- Bunds are bid with yields 2-3bp lower and the curve bull flattening. The 2s10s

spread has traded down 2bp.

- OAT yields are 1-3bp lower. Current yield levels: 2-year -0.621%, 5-year

-0.421%, 10-year -0.076%, 30-year 0.621%.

- BTPs have sold off with yields 3-4bp higher on the day. The Jun-20 BTP future

trades at 138.44, 42 ticks off the low.

- Gilts have rallied with the very long-end outperforming.