Indications that EU officials are.......>

EGB SUMMARY: Indications that EU officials are seeking to deliver a joint

statement of support for German Chancellor Angela Merkel has helped to ease

pressure in the bund market. 

- The benchmark 10-year bund yield has drifted down to 0.355% from 0.396% at the

open, while outperformance at the  long end has caused the curve to flatten with

the 2s10s spread compressing to 98bps from 101bps during the day.

- The French curve has steepened slightly with the 2s10s spread widening to

123bps from an intraday low of 121bps, while the 30-year OAT has traded down to

1.632% from a high of 1.660%.

- BTPs have fared slightly worse, with the 2-year year yield grinding higher to

0.628% following the sharp drop to 0.398% earlier in the day. The 10-year BTP

has oscillated more during the session, with the yield pulling back from the

afternoon highs and currently trading at 2.57%.

- The EURIBOR futures strip has flattened with Greens and Blues up 3.0-5.0 ticks