Bunds had a largely positive day with...>

EGB SUMMARY: Bunds had a largely positive day with the 10Y Mar-18 Bund contract

spiking higher on the back of a series of block trades. After reaching an

intra-day high of 161.82 the 10Y contract came under pressure towards the

European close as US Tsys sold off as a result of better than expected data and

the pricing of the E4bln Irish 10Y benchmark also weighed on Bunds. The German

curve flattened with 2s30s 2bp flatter. The 10Y Mar-18 Bund contract is

currently trading 2.3bp lower at 0.444%.

- Ireland priced E4bln of its new 10Y benchmark syndicated bond at mid-swaps

+2bp. Final book size closed in excess of E14bln. The reoffer price was 99.569%,

yld 0.944% which equated to +50.6bps vs Aug 2027 Bund.

- Spain has pared its tightening move vs Germany as markets prepare for the 5Y,

10Y 30Y Bonos auction, but Italy remains 1bp tighter.

- The Dutch Treasury announced E1.5-2.5bln tap of 0.00% Jan 2024 bond on Jan 9

and it revised its borrowing plans lower from E53.5bln to E50.5bln in 2018.

- Market sources reported of light selling in both core and peripheral linker

bonds today. Italy is leading the way with 5-yr Breakevens 2bp tighter.