German fixed income futures drew some.........>

BUNDS: German fixed income futures drew some support from the broader, modest

risk-off flows apparent in Asia-Pacific hours and operate just off best levels

as we move towards European trade. Schatz +0.005, Bobls +0.040, Bunds +0.13.

- Focus Monday fell on the narrowing BTP-Bund spread, after Fitch affirmed Italy

at BBB; outlook negative on Friday. Bunds came under some modest pressure on the

back of the weekend's Sino-U.S. trade developments, but finished well away from

worst levels as Tsys ticked higher into the close. Yesterday, Eurosystem sources

told MNI that the ECB could streamline its forward guidance to simply emphasise

that interest rates will remain unchanged for "as long as necessary" once it

drops its reference to "through the summer of '19" at some point over the next

few months. Elsewhere, 3 sources told MNI that chances were rising of an

announcement of a fresh round of TLTROs as soon as March 7. Also yesterday,

sources informed MNI that top ECB off'ls are worried that the slow EZ econ

growth might be a "new normal," which is here to stay.

- ECB's de Cos, Lane, Mersch, Visco & Coeure will speak later today. Elsewhere,

Germany will offer 2-Year paper this morning.