LONDON, March 4 German Bund futures opened
higher on Monday, with worries over the impact of automatic
budget cuts in the United States and political uncertainty in
Italy spurring demand for low-risk assets.
U.S. President Barack Obama and congressional Republican
leaders failed last week to find an alternative plan to avert
$85 billion worth of spending cuts, which economists expect to
hit growth in the United States and elsewhere in the world.
Neither side has expressed any confidence an agreement will
be reached soon.
In Italy, political parties have been wrangling over how to
form a government after elections last week produced a hung
parliament, raising concerns over whether the country can resume
efforts to reform its indebted economy any time soon.
Bund futures were last 21 ticks higher at 145.72,
having risen almost two full points last week.
"With the Italy deadlock continuing and the U.S. budget
(impasse) I don't see any reason why Bunds shouldn't stay
supported," one trader said.
Euro zone finance ministers meet in Brussels later in the
day with a bailout for Cyprus topping the agenda, although a
deal was not expected until later this month at the soonest.