January 10, 2013 / 7:10 AM / 5 years ago

EURO GOVT-Bunds steady before Spanish auction, ECB meeting

LONDON, Jan 10 (Reuters) - German Bund futures were steady on Thursday before a Spanish debt auction that is expected to find strong demand and a European Central Bank meeting where interest rates are seen kept on hold.

Stronger-than-expected Chinese trade data pushed Asian equities higher and could weigh on safe-haven Bunds in the early part of the session, traders said.

Spain plans to issue 4-5 billion euros of mainly short-dated debt, which falls within the remit of an ECB bond-buying programme that could be activated if Madrid asks for a bailout from its euro zone partners.

The ECB is expected to keep its key refinancing rate unchanged at a record low of 0.75 percent and its deposit facility rate at zero percent as the euro zone economy has shown some signs of stabilising recently.

However, investors will be looking for any clues from President Mario Draghi on the likelihood of future rate cuts.

At 0706 GMT, Bund futures were 1 tick up at 143.58.

“The ECB might be a bit more upbeat so chances of a rate cut might recede. You could argue its a negative (for Bunds) but I‘m not convinced. It’s all about future data,” the trader said.

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