German FI a touch higher than settlement......>

BUNDS: German FI a touch higher than settlement levels after Monday saw yet

another fresh low for 10-Year Bund yields. There has been little reaction in the

space to headlines noting that the U.S. TR has proposed adding tariffs to a

further $4bn worth of EU goods over the bloc's aircraft subsidies (some were

already speculating over such moves in the wake U.S.-China trade "truce").

- As a reminder Monday saw a slew of ECB speak, as Lane ('further easing can be

provided'), de Cos (inflation 'far' from target), Rehn ('ready to adjust all

instruments as necessary') & even erstwhile hawk Knot ('indisputable that

inflation remains too low') helped bolster the case for ECB easing. The bid was

also aided by the latest round of m'fing PMI data, which was soft, although the

EZ unemployment rate continued to edge lower & money supply data was solid.

- Also worth highlighting that Italy has reportedly agreed to cut its 2019

deficit goal to ~2.0% of GDP in a bid to avoid the EU deficit procedure.

- Focus today moves to German retail sales, the ongoing saga that is the

selection process for the top EU jobs, any comeback on the aforementioned tariff

outline from the U.S. TR, and comments from ECB's Knot & Vasiliauskas.