Holding Steeper, Futures Remain On The 101 Handle

Gilt futures remain happy to follow gyrations in U.S. Tsys in recent trade.

• Participants probably eyed the degree of dovish BoE repricing that was deployed into the end of ’23, which has further facilitated today’s widening pressure (gilts are wider across the curve vs. all major peers).
• Gilt futures have printed as low as 101.08 and last trade -140 or so, just below 101.25.
• Layers of technical support on the 100 handle (outlined earlier) remain untested.
• Cash gilt yields run 12.5-17.5bp higher across the curve, with some steepening seen.
• Bears in the long end will target 14 Dec highs for 20+-Year yields, while 2s and 5s still haven’t threatened to close the gaps lower vs. the 19 Dec closes.