/GILTS: Core EGB and gilt yields have...>

EGB SUMMARY: /GILTS: Core EGB and gilt yields have pushed lower through the

morning. The US has ratcheted up pressure on China, arguing that Beijing has

reneged on previous pledges, which has reignited concerns about global trade

headwinds. 

- The UK PM is reported to be meeting with Chairman of the 1922 Committee (of

backbench Conservative MPs) Sir Graham Brady today following renewed pressure

for the PM to step down. Gilts yields are 2-4bp lower on the day, with the

longer-end leading the charge. The 2s10s spread has narrow ~2bp.

- The German bund curve has similarly flattened with 2s10s trading down to

57.3bp from a high of 61.2bp.

- Italian BTPs have also rallied, but trading ranges are slightly tighter.

Current yield levels: 2-year 0.435%, 5-year 1.436%, 10-year 2.564%, 30-year

3.558%.

- The Euribor futures strip has flattened with greens/blues up ~2.5 ticks. Short

sterling futures are broadly 1.0-2.5 ticks higher.