Global bonds are broadly stronger as...>

BOND SUMMARY: Global bonds are broadly stronger as Turkey-related volatility has

abated for now, but remain in search of decisive direction.

- Gilts strengthened after UK CPI data met expectations at 2.5% Y/Y with core at

1.9%, but have since reversed those gains. Sep8 future up 6 ticks at 123.44.

- Eurozone periphery spreads are tighter, with the standout being Italy 2-yr

over Bunds, which are in 6.4bps vs Germany at 181.5bps.

- Bunds have steadied after a rally earlier, with the Sep8 future up 2 ticks at

162.23, down 14 ticks from the high.

- UST curve bull flattening slightly, 10-yr yield down 1.5bps at 2.884%.

- JGBs are a little stronger, with the 10-yr outperforming with a 1.1bps fall in

yield to 0.101%. Yields remain in a downtrend that began Aug 2.

- Global rate futures are largely unmoved, with the Short Sterling strip a touch

(0.5-1.0 ticks) lower post-CPI data.

- Data flow picks up in the afternoon, with the US reporting retail sales,

preliminary non-farm productivity, Empire State manufacturing, industrial

production, and business inventories.