Euro debt-Bund, Euribor rally after Trichet comments
LONDON, Jan 13 (Reuters) - The March Bund future and March Euribor interest rate future hit session highs on Thursday after comments from European Central Bank President Jean-Claude Trichet were seen by the market as dovish.
The move in Bund futures coincided with modest gains in U.S. Treasuries following U.S. retail sales data and a surprise rise in jobless claims.
Speaking after the ECB's decision to keep interest rates steady at 2.0 percent, Trichet said there is no significant evidence that underlying CPI pressures are building.
"On the one hand, it's Trichet and on the other U.S. Treasuries," said LBBW trader Charles Berry.
"Trichet's encouraging people to buy our market."
At 1350 GMT, the March Bund future <FGBLH5> was at 119.49, up 23 ticks on the day and compared to 119.20 just before Trichet started speaking. It hit a session high at 119.52 after the comments.
U.S. retail sales jumped by a more-than-expected 1.2 percent in December but excluding autos, sales rose 0.3 percent -- less than expected.
The March Euribor contract rose to the day's high 97.835 <FEIH5> from 97.810 just before Trichet began speaking and before the U.S. data was released.
"Euribor is going up because he says there is no risk to price stability," another trader said.