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Thursday afternoon's sell off in the....>

EGB SUMMARY
EGB SUMMARY: Thursday afternoon's sell off in the Treasury market led the Bund
contract 43 ticks lower at the open. The 30Y Treasury yield breached the 3%
level and MBS convexity-related hedging is around, although clearly with a much
lighter touch that pre-QE days.
- Within Europe, some of the fantastic outperformance of the 30Y tenor is being
handed back this morning. the 10Y Bund yield is 1.1bp higher at 0.733% but the
highest since August, 2015 but the 30Y yield is 2.3bp higher today.
- One theme that hasn't changed is the outperformance of the periphery. 10Y
spreads to Germany are only 0.5-1.0bp tighter today but the stronger growth in
Europe is diminishing credit concerns and Greece may even sell 7Y debt next
week.
- Implied volatility is also rising rapidly again. This morning, Bund RXH8
implied hit 5%. For most of December and January, this has struggled to get
above 4%. 
- Italian CPI data is due at 1000GMT, at the same time as Eurozone PPI numbers.
However, it is the US employment report that everybody is waiting for.

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