January 28, 2013 / 8:41 AM / in 5 years

EURO GOVT-Bunds erase losses as selloff draw buyers back in

LONDON, Jan 28 (Reuters) - German Bund futures trimmed early losses on Monday as traders bought back into a cheapened market after a steep selloff in the previous session, with low volumes also exaggerating price moves.

The Bund future was last 4 ticks lower on the day at 142.46 having earlier fallen as low as 142.11.

“The initial weakness was a bit of an overhang from last Friday. But today stocks are holding pretty flat, the euro/dollar is not doing much,” one trader said.

The contract fell sharply late last week after the European Central Bank announced 137 billion euros of long term loans would be repaid early by banks -- an above consensus amount that caused money market rates to rise.

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