LONDON Feb 1 German Bund futures opened lower on Friday as markets resumed a shift away from assets used as a safe haven from the euro zone's troubles, but trading was expected to be light ahead of a batch of major U.S. and European data.
Bund futures fell 27 ticks to 141.63, unwinding modest gains made in the previous session when regular month-end buying offered some respite from the worst month for German debt since June last year.
Further losses were expected if the European Central Bank announces that banks intend to repay another large chunk of its three-year emergency loans next week. Bunds fell last week when the first wave of repayments came in above expectations and traders expect around 20 billion euros to have been repaid this week. Details are due at 1100 GMT.
"The risk is that it comes in strong again and the Bund doesn't like it because people decide, rightly or wrongly, that that's a risk-on signal," a trader said.
The focus will then switch to U.S. non-farm payrolls data, a key indicator on the health of the world's largest economy, made even more pertinent after other recent numbers sent mixed signals.
"We see little if any likely outcomes that argue in favour of Bund longs. Instead we suggest going short in today's session weighing up the risk skew," Commerzbank strategists said in a note.