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GILTS: Wider Vs. Bunds.

GILTS
Bullet

Gilts continue to widen vs. Bunds, 

  • Readthrough into fiscal policy from PM Starmer suggesting that he wants government spending to catalyse private investment, while noting that he has “always thought that we should borrow to invest”, was likely behind the early widening.
  • German paper then benefitted from a dovish RTRS sources piece, pushing the move further.
  • Futures last 98.56, in the middle of a 32-tick range.
  • The corrective technical cycle in the contract has extended in recent days.
  • Today’s low protects key support at the Sep 2 low (98.11).
  • Bulls need to retake resistance seen at the 20-day EMA (99.82).
  • Yields 1bp lower to 1bp higher, curve twist steepens.
  • BoE-dated OIS still shows ~40bp of cuts through year-end and just under 125bp of cuts through June ’25.
  • SONIA futures -0.5 to +1.5, sticking to narrow ranges on the day.
  • Nothing of note on the UK calendar today, which will leave focus on central bank comments from the ECB & Fed, as well as the U.S. data.
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Gilts continue to widen vs. Bunds, 

  • Readthrough into fiscal policy from PM Starmer suggesting that he wants government spending to catalyse private investment, while noting that he has “always thought that we should borrow to invest”, was likely behind the early widening.
  • German paper then benefitted from a dovish RTRS sources piece, pushing the move further.
  • Futures last 98.56, in the middle of a 32-tick range.
  • The corrective technical cycle in the contract has extended in recent days.
  • Today’s low protects key support at the Sep 2 low (98.11).
  • Bulls need to retake resistance seen at the 20-day EMA (99.82).
  • Yields 1bp lower to 1bp higher, curve twist steepens.
  • BoE-dated OIS still shows ~40bp of cuts through year-end and just under 125bp of cuts through June ’25.
  • SONIA futures -0.5 to +1.5, sticking to narrow ranges on the day.
  • Nothing of note on the UK calendar today, which will leave focus on central bank comments from the ECB & Fed, as well as the U.S. data.