Strong regional German inflation.......>

BOND SUMMARY: Strong regional German inflation prints have been the theme of the

morning with Bunds under pressure. The national German CPI print is tracking

0.87% M/M based on our tracking estimate - this compares to a consensus of 0.5%

prior to the initial regional releases.

- In addition to strong German inflation, the pan-Eurozone GDP estimate for Q1

has come in a tenth stronger than expected, as has the Spanish GDP print while

French GDP was in line with expectations. The only data release to buck the

positive surprise trend today is Italian HICP which was a tenth lower than

expected.

- It is a quieter day today for US data with the MNI Chicago PMI, Conference

Board consumer confidence and house price data.

- Bund futures are down -0.49 today at 165.06 with 10y Bund yields up 2.9bp at

0.031% and Schatz yields up 0.8bp at -0.579%. TY1 futures are up 0-1+ today at

123-15+ with 10y UST yields up 0.1bp at 2.528% and 2y yields down -0.6bp at

2.287%. Gilt futures are down -0.38 today at 127.29 with 10y yields up 2.6bp at

1.182% and 2y yields up 2.1bp at 0.757%.