Key Levels Near

Weakness in gilts slows with futures basing just above cycle lows and 10-Year yields just off cycle highs.

• U.S. data and technical breaks in Bunds have helped keep the pressure on, even as RTRS headlines point to an imminent Israeli offensive in Rafah.
• Delta hedging surrounding the earlier pricing of the syndicated tap of the Jul-54 line would have factored into the move lower, even with robust demand metrics.
• The bearish technical backdrop remains intact, with the previously covered ’24 extremes providing the initial focal points.
• 5s continue to provide the weakest point on the curve, with benchmark gilt yields now 7.0-8.5bp higher.
• 20+-Year benchmark yields have hit fresh ’24 highs.