EURO GOVT-Bund futures rebound after investors reassess Fed move

LONDON Thu Dec 13, 2012 3:45am EST

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LONDON Dec 13 (Reuters) - German Bund futures erased earlier losses on Thursday after investors reassessed the implications of the latest policy move by the U.S. Federal Reserve.

The Fed said it would buy $45 billion in Treasuries each month and will expand its purchases to include five-year notes from the current seven-, 10- and 30-year bonds.

The Fed also took the unprecedented step of saying it would keep interest rates near zero until the jobless rate falls to 6.5 percent, well below its current level, so long as inflation is contained.

"We shouldn't have sold off as much as we did on the U.S. news," a trader said.

Bund futures were last 9 ticks higher on day at 145.35, having traded as low as 144.87 earlier in the session.

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