LONDON Jan 21 German Bund futures dipped on
Monday after an attempt in the United States to raise the debt
ceiling enough so it could pay its bills for another three
months dented appetite for safe-haven assets.
U.S. House Republican leaders said on Friday they would
seek to pass a three-month extension of federal borrowing
authority in coming days to buy time for the Democrat-controlled
Senate to pass a plan to shrink budget deficits.
European shares were seen supported by the news, but
with no clear response from the Democrats and an expected thin
session ahead due to a market holiday in the United States, the
impact on Bunds was seen limited.
"This is part of the political game, it remains to be seen
whether the Democrats will accept it. The market ... still
thinks at the end of the day we will see a solution," KBC
strategist Piet Lammens said.
"With the U.S. closed we don't expect too much from today's
The U.S. Treasury needs congressional authorization to raise
the current $16.4 trillion limit on U.S. debt sometime between
mid-February and early March. A failure to achieve that could
lead to a debt default.
At 0714 GMT, Bund futures were 7 ticks lower on the
day at 143.25.