Off Opening Lows Alongside Bounce In Bunds

Gilts look to cues from Bunds markets around the open, initially showing through yesterday’s low before bouncing.

• Gilt futures last print little changed, after bears failed to force a meaningful challenge of the August 29 low (94.14).
• Cash Gilts are flat to 1bp richer.
• SONIA futures are +1.0 to -1.5 through the blues, while BoE-dated OIS is flat to a touch softer.
• Upticks in the BRC retail sales data released overnight will have been viewed positively at first glance. Still, looking ahead they noted that “high interest rates and high winter energy bills will put pressure on many households to spend cautiously.”
• Elsewhere, Barclays noted that annual growth in credit card spending slowed in August, with the finger pointed at weather conditions. Part of the slowdown was also attributed to slower inflation (a positive).
• Final services & composite PMI headline a limited domestic docket.
• We also remain on the lookout for details surrounding the book opening of the 4.00% Oct-63 gilt syndication.