Bad day out in the gilt market. Gilt asw collapsing alongside a very sharp steepening and real yields up dramatically. Market participants were ok with the abandonment of the welfare plan but drew a line under replacing the chancellor. Straight up a term premia move and an unforced error.

30s can’t hold the bid after the auction is fucking awful. It’s going to get sent in Asian hours

Today has been a win for Trump who is short and delta on Spooz. A grind lower allows him to stay in his trade. We needed a big crash down today to stop him out. If we finish green or at these levels, it is very bad news in imo as it reenforces the directional of travel.

Front end spreads continuing to be bid with news that Fed may cut the rrp rate. Other drivers have been the easy realised funding conditions and the big B unit

Poor old Sonia taken to the woodshed again. The market will look to Bailey on Thursday for respite but we’ve now a shade under 3 cuts priced for basically the rest of the cycle. Which I suppose is plausible as long as the labour market doesn’t fall out of bed……