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Futures Back Towards Early Lows, Syndication Prices Tight, Sized At Lower End Of Exp.

GILTS

Gilt futures trade back towards early lows alongside Bunds, with little in the way of headline flow to note.

  • The contract is -15 or so (initial technical support remains untested), while cash benchmarks twist flatten, running 1.5bp cheaper to 1bp richer.
  • The lower tier consumer health checks (BRC & Barclaycard metrics) released overnight did little for the space, while the mark higher in the final services PMI release (49.5 from 48.7 flash) will have provided some light downside pressure.
  • The syndication of the 4.00% Oct-63 gilt has seen the spread set at the tight end of guidance and issuance sized at GBP5bn (the bottom end of our own expectations, orderbook closed in excess of GBP59bn, including JLM interest of GBP5bn).
  • SONIA futures print +1.0 to -1.5 through the blues, twist steepening, while BoE-dated OIS is little changed to ~2bp softer on the day.
  • The local data docket is essentially non-existent for the remainder of the day.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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