- European government bonds dropped sharply on Friday after payrolls were slightly ahead of estimates in the US, with an upward revision of 35K to the back month. - In an interview published over the weekend the ECBâs Bini Smaghi said that he expects Euro-Zone inflation below 2.0%. Bini-Smaghi said that, if the economy is still growing, the ECB may need to raise rates further. - With no major economic releases scheduled today focus is likely to fall upon technical trading, as well as comments from the FEDâs Kroszner. Kroszner is scheduled to speak at 12:45 ET. - Similarly in the UK, Gilts tanked upon the release of payrolls data in the US tracking treasuries and EGBs. - In focus today will be the release of PPI input and output data, scheduled for release at 5:30 ET. PPI output and output core are both expected to remain relatively unchanged, while PPU input is expected to rise on both a m/m and y/y basis. Additional focus will fall upon DCLG house prices, which are expected to fall to 9.6% in January from 9.9% in December. - Reminder: Daylight Savings Time became effective over the weekend in the US. Clocks went ahead one hour. (ie. The time disparity between EST and GMT is currently 4 hours, not 5 hours)