German fixed income futures hovered around....>

BUNDS: German fixed income futures hovered around settlement levels overnight

after a bid moved into the space in the wake of Thursday's ECB decision.

- The ECB surprised the market with a new TLTRO (most analysts did not expect a

formal announcement at the March meeting), a revision to interest rate forward

guidance (again, not widely expected for this meeting), a substantial downgrade

to 2019 GDP growth (1.1% vs 1.7%) and an across the board cut in the medium-term

inflation forecasts (2019 1.2% [1.6%); 2020 1.5% [1.7%] 2021 1.6% [1.8%]),

effectively frontloading all of the dovish components that were on the table.

- BTPs tightened on thursday, even with seemingly less favourable TLTRO III

terms vs. TLTRO II.

- BBG sources have since suggested that "some European Central Bank policy

makers consider the institution's downgraded growth forecast for 2019 is still

too optimistic, according to people with knowledge of the matter."

- German factory orders data headlines the domestic docket today, with ECB's

Nowotny also due to speak.