Europe holds onto gains, while Treasuries are offered

EGBs are better bid on the margin, but price actions have been limited overall, as investors and market participants awaits the US FOMC later today.

• Bund trades in a 29 ticks range (176.20/176.49), and up 6 ticks at the time of typing.
• Peripherals have kept up with Bund, translating in flat spreads versus the German 10yr.
• The only standout is Greece, trading 1bp tighter.
• Gilts initially outperformed Bund of the open, but the contract has since pared its gains, to trade 0.8bp wider against the Bund.
• UK/Bund spread move back to the widest level since the 4th of June.
• While we see German curve leaning steeper, the UK 5/30 is bull flatter, and just short of yesterday's low, now at 69.28.
• US Treasuries saw better selling during our morning European session but moves lack clear momentum.
• Tnotes are down 5 ticks at the time of typing and the US/German spread is 1.4bp wider so far.
• Looking ahead, US Wholesale Inventories is the notable release.
• Most of the attention is on the FOMC, but unlukely to change path at this meeting