It has been a busy day in Europe. The...>

EGB SUMMARY: It has been a busy day in Europe. The morning session was dominated

by the release of weak PMI data. The French services and manufacturing PMIs both

fell more than expected, the German manufacturing PMI fell below 50 and the

Eurozone aggregate indices showed that the slowdown was not just confined to the

biggest two countries.

- The ECB press conference saw the language surrounding risks downgraded with

Draghi's opening statement confirming the ECB see risks to the "downside" rather

than "broadly balanced...moving to the downside".

- In line with other global core bond markets, the German curve has bull

flattened with Schatz largely unchanged on the day but 10y Bund yields 3.4bp

lower on the day. Bund yields hit their lows of the day immediately after the

end of Draghi's opening statement.

- In contrast to the moves in core markets, EZ sovereign spreads have narrowed

across the board.