Extremely slow going today and to.......>

EGB SUMMARY: Extremely slow going today and to demonstrate this, the Bund

contract volume is only ~70% of the (already low) 10 day average. So far, the

Bund yield is almost precisely unchanged from yesterday at 0.377%, hugging the

200 day moving average like a life preserver.

- Non-German yield curves are steepening slightly and we would point out the

5-30Y box spread between France and Germany. This spread is now around 49bp

after rising further today, which is only 4bp below the steepest since EMU

began.

- There is a small tightening in peripheral spreads, reversing some of the

movements of the past week. The Bund-BTP spread is down 1bp but strangely, the

Bund-Bonos spread was 1bp wider.

- German paper is outperforming the swap curve and the RXU7 invoice spread is

46.7bp, its highest since mid-June.

- There was no important economic data or supply although we have received a lot

of commentary parsing the words of ECB's Wiedmann and Hansson from yesterday.