EMISSIONS: Think Tank Says COP30 Must Accelerate Global Emissions Reductions

Gilts are off session highs.

• Early cross-market support came from soft German data and some optimism surrounding the avoidance of fresh elections in France, but that move has stalled.
• The ONS has detected errors in the PSNB data, meaning that the UK’s fiscal situation is marginally less downbeat than was previously envisaged, which has probably driven some gilt curve flattening (although the discrepancies are quite minor in the grander scheme of things).
• 10-Year gilts underperform vs. Bunds, spread 1bp wider on the day at ~202bp.
• Futures +18 at 90.72.
• Bears remain in technical control, initial support and resistance located at 90.26 & 91.08, respectively.
• Yields 1bp higher to 1bp lower, 2s10s ~5bp off September closing lows, while 5s30s is ~2bp off its September closing low.
• The GBP5bln auction of the new 4.00% May-29 gilt passed smoothly enough, with the cover ratio comparable to the recent averages of auctions of surrounding lines and a sub-1bp tail generated.
• GBP STIRs little changed on the day, showing ~5bp of easing through year-end. We continue to believe that markets are underestimating the chances of a Q4 rate cut.
• Comments from BoE chief economist Pill are due this afternoon (16:00 London).
• Pill will speak at the Maxwell Fry Annual Lecture at the University of Birmingham. We do not know the subject of the address.

• EUR/USD: $1.1650(E698mln), $1.1700(E1.1bln), $1.1770-80(E1.2bln),  $1.1800(E1.5bln), $1.1850-60(E1.0bln)
• USD/JPY: Y146.50($1.2bln), Y147.00($1.5bln), Y149.00($980mln),  Y150.00($562mln), Y151.00($799mln)