German fixed income futures sit a touch.......>

BUNDS: German fixed income futures sit a touch above settlement levels; Schatz

+1.0 tick, Bobls +8.0 ticks, Bunds +12 ticks.

- The ECB decision & subsequent press conference with President Draghi represent

the major risk event today. The focus will be on the modalities of the new TLTRO

programme. Although Q1 GDP was better than expected, growth remains sluggish and

market-based measures of inflation expectations have deteriorated sharply - both

of which have fuelled the flattening term structure. This suggests that the ECB

will opt for a relatively favourable pricing structure for TLTRO-III to

encourage take-up and stimulate lending. This of course comes at a time when the

EUR 5-Year/5-Year inflation-linked swap is flirting with all time lows.

- The ever-evolving Italian fiscal situation continues to provide interest

elsewhere.

- On the domestic front, the latest round of monthly factory orders will be

worth a look. Further afield we will see the release of EZ employment & final Q1

EZ GDP data. France & Spain provide the highlights of the EUR denominated

supply.