Core EGBs have steadied......>

SHORT-STERLING OPTIONS: Core EGBs have steadied after earlier gains while

periphery EGBs are having a decent session Thursday led by Greece.

- Mar 19 Bund future is up 3 ticks at 165.71, off 165.97 high seen early amid a

bit of risk-off with U.S.-NKorea talks ending without a deal.

- German state inflation prints have been mixed vs expectations, ahead of

Pan-State number out at 1300GMT.

- Morgan Stanley said following state data, Pan-German expected to come in at

1.5%Y in CPI and at 1.7%Y in HICP terms (around pre-existing expectations).

- French 10-Yr spreads have fallen below 40bps to Germany for the first time

since mid-January.

- Greek debt is outperforming among periphery paper: 10-Yr spread vs Bunds is

down 4.9bps at 350.6bps. Risk-on as EU's Moscovici makes conciliatory comments

in Athens, Greek bank index rallying 5+%.

- Italy 10-Yr spreads down 1.8bps at 261.8bps, Portugal in 1.2bps at 131.6bps,

and Spain down 0.2bps at 100.9bps.

- No ECB speakers scheduled with Mar 7 meeting looming.