External pressures hit EGBs, as.........>

EGB SUMMARY: External pressures hit EGBs, as strong US data and announcements of

larger Treasury auction size hit USTs, and JGBs sold off on BOJ policy shift.

- Curves have bear steepened, pivoting around the 10-Yr (that segment of the US

and Japanese curves have likewise underperformed). 10-Yr Bund yields up 3.9bps

at 0.482%, having peaked at six-week high of 0.491% earlier.

- OAT/Bund spreads are wider, with the 10-Yr OAT yield up 4.9bps to 0.781%.

Pressure comes ahead of Thursday's tap of OATs between 11-and 18-Yr.

- EGB peripheries have had a mixed performance, with Italian BTPs

underperforming slightly, 10-Yr wider to Bunds by 2.0bps at 229.6bps.

- Spanish 10s are 1.0bps wider, while Portuguese and Greek 10s have come in by

0.5bps and 2.9bps respectively, the latter recovering some of Tuesday's selloff.

- The long end of the Euribor strip has looked weak all day, with Greens and

Blues off 2.0-3.0 ticks. However it is outperforming long-dated Short Sterling

and Eurodollar equivalents which are off 4-6 ticks.

- US FOMC at 1800GMT looks likely to be a non-event, but Thursday brings

potential impacts from Bank of England and Spanish and French supply.