FED: US TSY 17W AUCTION: NON-COMP BIDS $619 MLN FROM $60.000 BLN TOTAL

• US TSY 13W AUCTION: NON-COMP BIDS $2.372 BLN FROM $76.000 BLN TOTAL

• US TSY 26W AUCTION: NON-COMP BIDS $1.548 BLN FROM $68.000 BLN TOTAL

Early Gilt outperformance against Bunds has consolidated through the session, with the 10-year Gilt/Bund spread still 4.5bps tighter at 214bps.

• 30s lead the recovery from Friday’s lows, with benchmark yields down 12.5bps at typing to 5.39%. This seems to represent an unwind of the weak price action last week, rather than any reassessment of UK economic fundamentals.
• Beta to US Treasuries will also be factoring in, with UST yields 4.5-11.0bps lower at typing.
• Gilt futures are +89 ticks at 91.53, just shy of earlier session highs of 91.61. The 20-day EMA at 91.84 remains initial resistance.
• The SONIA strip has twist flattened, with whites -1.0 to -2.0 ticks and blues +3.0 to +4.5 ticks.
• BOE-dated OIS price 23bps of easing through May (0.5bps more hawkish than Friday’s close), while August ’25 implied cuts have deepened 2bps to 48bps in today’s session.
• Labour market data headlines tomorrow’s macro calendar. Our preview will be out shortly.