- Having sold off at the open, German...>

EGB SUMMARY: - Having sold off at the open, German bunds have rallied since

early morning. The 3-year yield has pushed down to -0.4777% from a morning high

of -0.455% while the 10-year is down to 0.441% from 0.481%. The 2s10s spread has

narrowed to 103.2bpps from a high of 105.6bps.

- French OAT yields have pushed lower and the curve has flattened slightly since

midday. The 2-year benchmark trades at -0.402% down from -0.381%.

- It has been another volatile session for Italian BTPs as indications of a

standoff between Rome and Brussels over the budget has countered the relatively

positive news that Moody's did not cut the sovereign credit rating below

investment grade (announced on Friday after the European close). The 2-year BTP

has traded within a wide 0.852/1.22% range and is currently trading at 1.132%.

- The short end of the Spanish curve rallied at the open and then traded

sideways from early morning, while the longer end also rallied but subsequently

reversed. The 2s10s spread has traded up to 181.3bps from a low of 175.2bps.

- The Euribor futures strip is broadly 0.5-2.0 ticks lower.