Italian BTPs have underperformed........>

EGB SUMMARY: Italian BTPs have underperformed Wednesday, with core EGBs steady.

- With ECB`s Praet this morning casting doubt on a TLTRO announcement by the ECB

in March, Mar 19 BTP futures sold off, last down 51 ticks at 127.38.

- Losses across the Italian curve were initially at the short-end but currently

the belly is underperforming: the 2-Yr yield is up 5.3bps at 0.466%, 5-Yr up

6.5bps at 1.786%, 10-Yr up 5.7bps at 2.845%, and 30-Yr up 3.3bps at 3.676%.

- Meanwhile March Bunds are up 3 ticks at 166.45, steadying after earlier gains

(high of 166.69). Cash curve mixed, limited moves of 0.1-0.2bps in benchmarks.

- 10-Yr BTPs 5.8bps wider to Bunds at 274.1bps. Spanish and Greek spreads little

changed; 10-Yr Portuguese bonds 1.3bps wider at 141.7bps.

- Likewise, French 10-Yr OAT spreads/Bunds largely unchanged, down 0.1-0.2bps at

42.6bps.

- While attention post-session will be on Fed minutes, Thursday morning sees a

pickup in data flow including German and French Jan flash inflation.

- Thursday also sees Spain and France selling M/T and L/T paper at auction.