LONDON Jan 25 German Bunds were steady on
Friday as traders expected mixed data out of Europe and only a
limited impact from the European Central Bank's announcement on
the size of the bank repayment of cheap ECB loans.
Britain's economy is expected to have contracted 0.1 percent
in the fourth quarter of last year, according to a Reuters poll,
while Germany's Ifo index, a key barometer of the country's
economic health, is seen rising for a third month in January.
The ECB will also announce this session how much banks plan
to repay of the 489 billion euros they borrowed from the central
bank in the the first round of cheap long-term financing in
Although Italian and Spanish debt are expected to withstand
any withdrawal from the banking system next week, the repayment
could impact money markets. .
German Bund futures were up 4 ticks on the day at
"The bigger it is, in theory, the worst it is on the
front-end, although I think it's fairly priced in at the moment.
I think it would have to be a big number to really hurt things,"
one trader said.
Traders expect 100 billion euros will be returned to the ECB
next week, according to a Reuters poll but forecasts ranged from
from 30 billion to 250 billion euros..