EM ASIA CREDIT: MNI EM Credit Market Update - Asia

• EUR/USD: $1.1015(E1.1bln), $1.1070-75(E1.8bln), $1.1100-05(E780mln), $1.1195-00(E1.5bln), $1.1245-50(E1.2bln), $1.1300(E1.1bln)
• USD/JPY: Y145.00($795mln), Y145.50($1.0bln), Y146.00($621mln)
• USD/CAD: C$1.3900-15($807mln)

Gilt futures extend higher alongside core FI peers, now +28 ticks today at 91.78 and outperforming Bunds. As noted above, there hasn’t been an obvious fundamental driver of the latest bid. A bear cycle in Gilts remains in play following the recent impulsive selloff, and rallies short of the 20-day EMA at 92.20 will be considered corrective. Initial resistance shielding this level is 92.03, the May 16 high. Yesterday’s low at 90.86 provides support.

• 10-year yields are down 3.7bps to 4.63%, with the Gilt/Bund spread tightening 1.5bps to 205.5bps.
• The curve has lightly bull flattened, with 2s10s down 1bp and 10s30s down 0.5bps.
• The DMO is expected to launch the new 5.375% Jan-56 gilt today. MNI expects a GBP5.5-8.5bln transaction size.
• Yesterday evening saw BoE’s Dhingra outline the thought process behind her dovish dissent last week, telling the FT that "I get to pick times when I want to be able to make a more categorical statement about where I think the economy is headed”.
• Comments from BoE hawkish dissenter and chief economist Pill are due this morning (09:00). He previously noted that he will flesh out the thoughts that drove his hawkish dissent at this event.
• UK CPI data, due tomorrow, headlines this week’s UK data calendar. MNI’s preview will be out later this morning.

• ERM5 97.87p, sold at 1.25 in 10k.
• ERM5 97.81p, sold at half in 20k.