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EGBs-GILTS: On The Back Foot

BONDS

Core FI is on the back foot to start Friday, with Gilts underperforming. UK short-end continues to underperform, while 10Yr is weakest for Germany.

  • Risk picture is mixed so far: equities a little softer (Eurostoxx 50 slipping after nearing first resistance at 4161.00), periphery spreads modestly tighter with Greece leading.
  • Overall fairly light volumes so far. The session's scheduled highlight is the US employment report out at 1330BST.
  • Only items of note on the European data calendar this morning are German IP (out earlier, weaker than expected), Italian IP at 0900BST. Only supply is Belgium ORI for E500mln.
  • BoE's Broadbent speaks at 1215BST.

Latest levels:

  • Sep Bund futures (RX) down 28 ticks at 177.01 (L: 176.98 / H: 177.27)
  • Sep Gilt futures (G) down 23 ticks at 130 (L: 129.98 / H: 130.08)
  • Sep BTP futures (IK) down 33 ticks at 155.29 (L: 155.15 / H: 155.38)
  • Italy / German 10-Yr spread 0.3bps tighter at 102.5bps

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