Little movement so far in the early.....>

EGB SUMMARY: Little movement so far in the early hours of European trading.

Bunds initially opened a few ticks lower on the back of news that Stanford's

John Taylor impressed President Trump. Taylor rules generally show rates needing

to be much higher than current levels.

- Once again, the Italian market is well bid as the carry trade is shown to be

alive and well. 2Y Italy is 2bp lower, which is in contrast to a 0.3bp rise in

the Bund. 

- The 10-15Y area of the German curve is trading heavy, normally an insurance

dominated section of the yield curve.

- KfW opened books on a EUR3bln no-grow 5Y at mid swaps minus 31bp and is

today's business.

- The EGB highlight today is the 2Y Schatz auction later today, a section of the

curve that has regularly seen insufficient bids relative to the amount on sale. 

- In data terms, the ZEW  survey and final Eurozone CPI data will be the

highlights.

- Currently, the 10Y Bund yield is +0.4bp at 0.375%; the Bund-BTP -1bp at 165.2.