Italian spreads are wider Wednesday.....>

EGB SUMMARY: Italian spreads are wider Wednesday as Rome`s finances are under

renewed scrutiny, while core EGBs are a little stronger.

- 10-Yr Italian BTP spread vs Bunds is up 5bps at 263.6bps, with EC warning that

Italy`s projected debt ratio reduction is unrealistic.

- This came after solid auction of new 10-Yr BTPs this morning which had helped

BTPs rally. Mar 19 future last down 40 ticks at 128.42, earlier low of 128.32.

- EC also warned that Italy's debt and growth issues were risks for the rest of

the eurozone. But other periphery EGB spreads fairly steady, Spain 10-Yrs out

1.6bps vs Bunds at 103.6bps.

- Mar 19 Bund future is up 14 ticks at 166.41, with 2-Yr yield unchanged at

-0.536%, 5-Yr down 1bps at -0.338%, 10-Yr down 1.1bps at 0.107%, and 30-Yr down

0.7bps at 0.738%. Bund sale this morning not particularly noteworthy.

- ECB/Bundesbank`s Weidmann this morning said new TLTROs would `need policy

reason`, ECB `should look through short-term weakness`, and more interestingly

that fiscal policy reaction needed `in case of big shock`.