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There has been a distinctive risk......>

BOND SUMMARY: There has been a distinctive risk off pivot in govies this morning
with sharp bull flattening of core sovereign curves alongside a selloff in the
Eurozone periphery. 
- USTs have been bid with the long-end outperforming. 20- and 30-year yields are
now 6bp lower on the day while the 2s30s spread is 5bp narrower.
- Gilts have similarly rallied, but have lagged USTs. Cash yields are broadly
2-3bp lower with the curve flat overall.
- Flattening has been more pronounced for the bund curve with the 2s30s spread
trading down 4bp.
- BTPs have trading weaker with the shorter end underperforming. Yields in the
1- to 10-year bucket are up 2-3bp on the day.
- Italy sold a combined E10bn of 12-month and flexible BOTs which concludes
Eurozone government bond and bill supply for the week.
- US PPI data for June will be published this afternoon although is typically
not market moving. Canadian labour market data for June will be more closely

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