The Bund market started well............>

EGB SUMMARY: The Bund market started well following the dovishly-interpreted

FOMC statement and quickly built on those gains but after it hit 162.50, it was

downhill all the way without much in the way of pauses.

- European economic data, like M3 created little interest but the US durable

goods data were decent and the shipments component prompted a flurry of GDP

upgrades and declines in the Treasury market that Bunds followed.

- Alongside that rise in Treasury yields, the dollar index appreciated and

particularly against the euro. 

- As the EGB market headed to the close, the 2Y Schatz was 1.1bp lower at

-0.673% and 10Y Bund yield was 2.5bp lower at 0.536%.

- Spanish debt was performing particularly strongly, even though there was a

small wiggle in the first couple of hours of trading. The Bund-Bonos spread

tightened 2bp to 97bp and Italy also manager to tighten a 1bp versus Germany

although auctions on Friday may have held back Italian debt.

- There was some unusual price action with the semi core, such as France

underperforming both Germany and the periphery.