OIL: Citi Keeps Brent Base Case in Low $60s/b

• Date $MM Issuer (Priced *, Launch #)
• 07/08 $3B *IADB (Inter-American Development Bank) 10Y SOFR+61
• 07/08 $2.25B #American Honda $900M 2Y +65, $600M 2Y SOFR+87, $750M 7Y +100
• 07/08 $Benchmark BFCM 3.25Y +72, 3.25Y SOFR+99
• 07/08 $750M Gray Media 7NC investor calls
• Potential roll-over from Monday:
  • 07/?? $Benchmark Nissan Motor 5Y 7.25%a, 7Y 7.75%a, 10Y 8%a
  • 07/?? $Benchmark NTT Finance Corp multi tranche investor calls: 2Y, 3Y fix/SOFR, 5Y fix/SOFR, 7Y, 10Y, 12Y -- in addition to EUR issuance 2Y, -4Y, 8Y and 12Y

• RES 4: 1.3852 1.764 proj of the Feb 28 - Apr 3 - 7 price swing
• RES 3: 1.3835 High Oct 20 2021
• RES 2: 1.3800 Round number resistance
• RES 1: 1.3789 High Jul 01 and the bull trigger 
• PRICE: 1.3568 @ 16:15 BST Jul 8
• SUP 1: 1.3526 Low Jul 08
• SUP 2: 1.3468 50-day EMA
• SUP 3: 1.3379 Trendline support drawn from the Jan 13 low 
• SUP 4: 1.3245 Low May 19

A bull cycle in GBPUSD remains in play and recent weakness appears corrective. Support at 1.3602, the 20-day EMA, has been pierced. A clear break here would signal scope for a deeper correction towards the 50-day EMA at 1.3468. Key resistance and the bull trigger is at 1.3789, the Jul 1 high. Clearance of this hurdle would resume the uptrend. Note that MA studies are in a bull-mode position, suggesting the M/T uptrend is intact.           

European yields rose Tuesday, with continued curve steepening.

• Core FI was under pressure from the open, following on from Monday's weak close. There were multiple cause driving weakness, including supply (Netherlands, Austria, EU) along with a 3-week extension of the US's tariff negotiation deadline to Aug 1.
• While there was little immediate market reaction, the release of the UK OBR's Fiscal Risks and Sustainability Report reminded of longer-term fiscal concerns.
• Yields rose steadily all morning before before steadying in afternoon trade. 10Y Gilt yields pushed through the July 2 highs to hit the highest levels in a month.
• 10Y Bund yields hit a fresh 3-month intraday high of 2.707% but ultimately held on to the 2.70% area (mid-May highs).
• The UK and German curves both bear steepened, though short-end Gilts outperformed.
• Periphery/semi-core EGB spreads were mixed, with Greece outperforming.
• Wednesday's calendar includes appearances by ECB's Lane, Guindos and Nagel and the release of the BOE's FSR, though it's a lighter day for data including Greek June inflation. There will also be focus on EU-US trade negotiations, with President Trump saying after the European cash close that a tariff "letter" to Brussels is probably two days away.

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is up 3.5bps at 1.872%, 10-Yr is up 4.4bps at 2.687%, and 30-Yr is up 5.4bps at 3.172%.
• UK: The 2-Yr yield is up 0.8bps at 3.872%, 5-Yr is up 3.1bps at 4.042%, 10-Yr is up 4.7bps at 4.633%, and 30-Yr is up 6.3bps at 5.454%.
• Italian BTP spread up 0.2bps at 85bps /Greek down 0.6bps at 68.8bps