Core EGBs are trading fairly quietly....>

EGB SUMMARY: Core EGBs are trading fairly quietly Wednesday, while Italian and

Greek spreads have narrowed, with German CPI and US Fed decision awaited.

- The Mar 19 Bund future is up 10 ticks at 165.18, within a tight 26 tick range

today. 2-Yr yield is up 0.7bps at -0.563%, 5-Yr is down 0.2bps at -0.296%, 10-Yr

is down 1bps at 0.19%, and 30-Yr is down 1.4bps at 0.785%.

- Decent auctions this morning, with Italy selling E5.25bln (top of range) in 5-

and 10-Yr BTP, and Germany allotting E2.3bln of 10-Yr Bund.

- 10-Yr Italy/Germany spread continues to compress, down 2.3bps today at 241bps.

- Greee surrendered some gains in the afterglow of Tuesday's successful 5-Yr

syndication, but 10-Yr spreads remain down 3.8bps at 374bps (had gone as low as

371bps earlier).

- Spain and Portugal wider vs Germany, 10-Yr out 2bps and 0.1bps respectively.

- German inflation due at 1300GMT the main focus for the afternoon.

- Later sees US Fed decision at 1900GMT, with press conference at 1930GMT.