A relatively range-bound session for....>

EGB SUMMARY: A relatively range-bound session for EGBs earlier on swiftly turned

into a rout shortly after the US market open, as 10Y Tsy yields broke through

the key 3.00% with conviction and the USD jumped.

- Bund futures are near their daily lows, with the Jun18 contract off 26 ticks

to 157.88, now down 115 ticks since Monday's open. German 2s10s 1.6bps steeper

at 118.3bps, as Schatz remained flat. Little steepening across the rest of the

curve though, with 10s30s up just 0.3bps.

- There was relatively little damage done on the Euribor futures strip, though

longer-dated futures underperformed amid steepening. Blues off 1.5-2.5 ticks.

- The periphery had a mixed day with Italian 10 Yr BTP/Bund spreads compressing

by 1.5bps to 130.3bps despite/because of political developments, but the BTP

yield rose 1.1bps to its highest rate since March (1.94%). Italy outperformed,

though: Spanish 10Yr Bonos are up 1.4bps, and Portuguese PGBs are up 2.0bps.

- EGB issuance picks up Wednesday with Germany re-opening its 10-year benchmark

0.50% Feb-28 Bund for up to E2.0bln. France and Spain to follow on Thursday.