EGB/Gilt: Biden-Putin Summit In The Balance

European government bonds have traded weaker this morning in tandem with equities.

• Presidents Biden and Putin have agreed 'in principle' to a summit to discuss the Ukraine crisis, although Moscow has downplayed the possibility by stating that there are no concrete plans.
• Preliminary Eurozone PMI data for February came in better than expected with the Services series printing 55.8 vs 52.1 survey and the Composite reading coming in at 55.8 vs 52.9. Elsewhere, both the Services and Composite series for the UK were above 60 in February and similarly beating expectations.
• Gilts opened lower, but soon started to recover losses. The short end is now close to flat on the day, while belly/long-end yields are up 1-2bp.
• Bunds similarly recovered some of the earlier losses with cash yields now up 1-2bp and the curve slightly bear flattening.
• OATs trade broadly in line with bunds. The 2s30s spread has narrowed 1bp.
• BTP yields are 1-3bp higher.
• Supply this morning came from Germany (Bubill, EUR2.845bn allotted), Netherlands (DTCs, EUR2.98bn) and Slovakia (SlovGBs, EUR842mn). Later today France will offer 4.7-5.9bn of BTFs.