/GILTS: Today's euro area data..........>

EGB SUMMARY: /GILTS: Today's euro area data releases have provided a modicum of

relief, with German inflation data surprising higher and Italian Q1 GDP growth

back in positive territory. Core yields have inched higher while Italian BTPs

have rallied.

- German bund yields are 1-3bp higher on the day and the curve is ~2bp steeper.

Current yield levels: 2-year -0.582%, 5-year -0.401%, 10-year 0.029%, 30-year

0.672%.

- The Italian BTP curve has steepened, driven by the shorter-end outperforming.

The 2s30s spread has widened to 303.5bps from a low of 298.4bp.

- In what could charitably be called optimistic, UK PM Theresa May has indicated

that she wants cross-party talks to conclude before the end of next week.

Meanwhile, the Labour National Executive Committee is due to announce its

manifesto for European Elections and confirm whether it will demand a second

referendum on a Brexit deal. 

- Gilts have sold off today, with the 7-/10-year benchmark yields up 4bps and

leading the charge.