Reversal, With UK Long-End Weakness In Focus Again

Yields have reversed higher Wednesday after the rally earlier in the week, with the UK long end continuing its dramatic underperformance.

• USTs are outperforming amid a broader risk-off move including a broadly stronger USD.
• A global focal point continues to be 30Y Gilt yields which rose by as much as 20bp, last up 11bp, in volatile trade.
• Earlier, EGBs were underpinned to a modest degree by weak Italy and Spain service PMIs and final Eurozone readings seeing weaker revisions, though UK PMI saw an upward revision.
• Attention for the rest of the session paid to UK PM Truss's conference speech, a non-monetary policy ECB meeting, and US ADP Employment and ISM services. Fed's Kashkari and Bostic also appear.

Latest levels:

• US: 2-Yr yield up 2.7bps at 4.1192%, 5-Yr up 6.4bps at 3.9177%, 10-Yr up 7.2bps at 3.7048%, and 30-Yr up 5.9bps at 3.7538%.
• DE: 2-Yr yield up 3.6bps at 1.606%, 5-Yr up 6.7bps at 1.774%, 10-Yr up 7.7bps at 1.948%, and 30-Yr up 7.8bps at 1.985%.
• UK: 2-Yr yield up 10.8bps at 4.028%, 5-Yr up 8.7bps at 4.198%, 10-Yr up 10.3bps at 3.978%, and 30-Yr up 10.4bps at 4.142%.
• Italy / German 10-Yr spread 6.1bps wider at 236.8bps