10Y Bund yields are around 0.3bp........>

EGB SUMMARY: 10Y Bund yields are around 0.3bp higher so far today at 0.436%

although preparation for the auctions and supply today initially took the Bund

contract lower. The slightly dovish speech by Atlanta Fed President, Bostic did

not appear to move Treasury prices overnight.

- Some selling is evident in the front end of the Spanish curve, which we hear

has come from domestic investors.

- Yesterday evening, the Italian Treasury announced that it would only sell 3

and 7Y BTPs at its Thursday auction and in sizes that were on the low side.

However, the market has taken little solace from this reprieve and the Bund-BTP

spread is 0.2bp wider at 155.4bp. 

- KfW has just announced guidance for its new 10Y EUR at MS-16bp area, a level

that is seen by market participants as cheaper than fair value. Later today, the

Netherlands sells 6Y debt, Austria 10Y and 30Y and Germany has a 30Y Bund

linker.

- It has been a busy morning for European data, led by a strong German trade

surplus but there are few additional market movers for the remainder of the day.