While not nearly as wild a day as.......>

EGB SUMMARY: While not nearly as wild a day as Tuesday, EGBs traded in a wide

range Wednesday amid a combination of short-covering, hawkish macro data, and

continuing Italian political uncertainty.

- Italian 10-year BTP spreads over bunds are down 20.5bps to 270.4bps, neatly in

the middle of the day's range of 247.9-290.1bps. There is no specific event

awaited on Italy, though if a new election is to be called for July 29, now is

effectively the day to dissolve parliament, as it requires 60 days` notice.

- Strong German flash CPI, retail sales and unemployment data helped weigh on

Bunds, which recovered after the US open as investors took off a bit of risk but

came off a bit late - Jun18 contract off 81 ticks at 161.99. Saw massive euro

armaggeddon trade flow on OTM Bund Sep 197 call options, total 19.5k blocked.

- Bund curve a bit steeper after flattening early, 2s10s up 1.0bps to 102.9bps.

- Greece 10s came in 28.2bps to Bunds, outpacing the rally in Spain (9.5bps) and

Portugal (11.2bps) after Tuesday's underperformance.

- Euribor Blue contracts near their lows to end the day, off 5-6 ticks. Now just

4-5 ticks above Tuesday's open, and 13-14 off Tuesday's highs.