EM LATAM CREDIT: Banco Industrial: $ 10.25NC5Y Sub Tier 2 Launch

European yields fell modestly Tuesday, with Gilts slightly outperforming Bunds.

• EGBs and Gilts resumed the weakness seen in the prior two sessions in early trade, coming off session lows around 0830ET as European equities pulled back from what would be session highs.
• There was no obvious macro driver to the latter move, with the rest of the session seeing relatively limited movement amid a thin data slate (US job openings saw bonds come off session highs) and events docket and ahead of Wednesday's Federal Reserve decision.
• Ahead of next week's rate decision, BoE Deputy Governor Ramsden leaned a little dovish in TSC testimony though this brought limited market reaction.
• OAT futures gained slightly after hours as the French parliament passed the spending part of the contentious Social Security budget.
• Wednesday's calendar includes Italian industrial production data and appearance by ECB's Lagarde and Makhlouf, but most global attention will be on the Fed meeting where policymakers are set to deliver a "hawkish cut" of 25bp.

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is down 0.5bps at 2.154%, 5-Yr is down 1.3bps at 2.466%, 10-Yr is down 1.2bps at 2.85%, and 30-Yr is down 0.2bps at 3.459%.
• UK: The 2-Yr yield is down 2.6bps at 3.785%, 5-Yr is down 2.4bps at 3.972%, 10-Yr is down 2.3bps at 4.505%, and 30-Yr is down 3.3bps at 5.195%.
• Italian BTP spread down 0.5bps at 69.5bps / French OAT down 0.5bps at 71.3bps

• Block Sale -6,000 TYH6 112-03, post time bid at 1356:11ET, DV01 $403,000.
• Treasuries extended session lows following the cross - TYH6 tapped yesterday's low of 112-02.5 (-5.5) - before drawing some support to 112-04.
• Round number support in focus: 112-00, the 1.00 projection of the Oct 17 - Nov 5 - 25 price swing. Clearance of this level would open 111-19, the 1.236 projection.

• RES 4: 0.8840 High Nov 20   
• RES 3: 0.8818 High Nov 26 
• RES 2: 0.8802 High Dec 2 and a key near-term resistance 
• RES 1: 0.8769 20-day EMA
• PRICE: 0.8741 @ 16:36 GMT Dec 9
• SUP 1: 0.8722 Low Dec 4
• SUP 2: 0.8706 76.4% retracement of the Oct 8 - Nov 14 bull leg
• SUP 3: 0.8670 Low Oct 21   
• SUP 4: 0.8656 Low Oct 8 and a key support  

The bear cycle in EURGBP that has dominated recent weeks appears corrective - for now. Note that the cross has breached the 50-day EMA, currently at 0.8752. The break highlights a stronger reversal and a bear threat, plus scope for a deeper retracement, towards 0.8706, a Fibonacci retracement. Initial resistance to watch is 0.8802, the Dec 2 high. Clearance of this hurdle would be a bullish development and signal a resumption of the uptrend.