EURO GOVT-Bunds little changed, Greece watched

LONDON, April 11 (Reuters) – Bund futures were little
changed on Monday, while bonds issued by lower-rated euro zone
states may come under pressure after a report that Greece is
under pressure to restructure its debt.

Several euro zone finance ministers told ECB President
Jean-Claude Trichet they have doubts Greece will meet its fiscal
targets and suggested Athens restructure its debt, a German
magazine reported on Saturday. [ID:nLDE738064]

“It is in the price to a degree, but the Greece (report) may
put the periphery under the spotlight,” one trader said.

Officials from the European Commission, the European Central
Bank and the International Monetary Fund will also discuss the
technical details of Portugal’s bailout this week.

At 0606 GMT, the Bund future (FGBLc1: Quote, Profile, Research) was 3 ticks higher at
120.07. The Schatz yield (DE2YT=TWEB: Quote, Profile, Research) hovered near its highest
since Dec. 2008, trading at 1.918 percent as markets bet the ECB
could raise interest rates again as soon as June.

Ten-year yields (DE10YT=TWEB: Quote, Profile, Research) were 1.1 basis points down at
3.478 percent.

“It’s not looking great for Bunds either. If we pass that
3.5 percent yield level we’re looking a bit fragile,” the trader
said.

(Reporting by Marius Zaharia; Editing by John Stonestreet)

EURO GOVT-Bunds little changed, Greece watched