Lower On The Day Following Schatz Supply And Issuance Announcements

Core/semi-core EGBs are off intraday lows but remain weaker on the day with Schatz supply alongside sovereign/corporate issuance announcements weighing.

• Bunds sit 10 ticks lower at 136.79, having traded in a 49 tick range today. Yesterday's low of 136.25 is currently deemed as corrective in nature, with the broader uptrend still intact. OATs are 19 ticks lower at 131.08 at typing.
• The German cash curve has lightly twist steepened, with 10Y Bund yields up 0.1bp at 2.067% and Schatz yields down -0.3bp at 2.444%. The French curve has bear steepened.
• Today's macro slate has been highlighted by German and Spanish labour market data, neither of which were market movers. The German unemployment claims change for December was less than expected, while the unemployment claims rate ticked higher to 5.9% (vs a revised 5.8% prior).
• Periphery spreads to Bunds have widened, with Italy and Greece seeing the largest moves. The 10-Yr BTP/Bund spread is 3.7bps wider at 168bps, after posting below 160bps for the first time since July in late December.
• The remainder of today's docket is limited, with US jobs/ISM data likely to gain most traction.