It has been a very quiet start to the...>

EGB SUMMARY: It has been a very quiet start to the final trading day of the

month. So far, the 2Y Schatz yield is unchanged at -0.603% and the 10Y Bund is

+0.5bp at 0.51%. The 'biggest' mover is the long end of Ireland where the 10-15Y

section has underperformed Germany by around 0.5bp.

- The Bund market has largely shaken off the weakness in the Treasury market,

which was hit by a 7Y note auction that tailed by a massive 2bp. The 7Y area is

often popular with Japanese banks and the FY-end may have curtailed the bid

together with the recent curve flattening.

- The first German State CPIs printed 0.5%M/M in Rhineland Palatinate and

0.4%M/M in Saxony. These are middle-sized States and compare to a national

consensus at 0.5%M/M, which is released this afternoon.

- Later today, month end extensions from Bloomberg-Barclays show a 0.08Y rise in

the Euro Agg Tsy index and the Euro Govt linker index extends by a modest 0.01Y.

Buying usually kicks in late in the afternoon.

- US data should be market-moving with initial claims, PCE income/spending and

deflator followed by University of Michigan.