- European government bonds closed lower yesterday after the ECB's Trichet signaled that the ECB may have to raise rates further in the post interest rate announcement press conference. - As expected the ECB raised its key interest rate by 25 basis points to 3.75% yesterday. In the press conference held after the decision Trichet said that future rate decisions would depend upon the ECB's assessment of risks to price stability. Trichet said that rates were moderate (note that he previously said that rates are low), and said that monetary policy is on the accommodative side. - The German Chemical Union announced yesterday that workers will be receiving a 3.6% wage hike along with a 0.7% one-off payment. The Union initially souht a 4.0% to 4.5% wage hike. - In focus today will be the German whole sales price index, as well as French Industrial and Manufacturing production due out at 2:00 and 2:45 respectively. The German wholesales price index is seen remaining unchanged at 0.0% m/m, and is expected to drop to 2.5% y/y from January's 3.1%. French industrial and manufacturing production data is expected to fall on all fronts. - Over in the UK gilts closed slightly lower. As expected, the Bank of England left rates unchanged at 5.25%. Investors will now await the Bank of England minutes which are scheduled for release on 3/21. - The focus in todayâs session will be Industrial and Manufacturing Production for the month of January. Industrial Production is seen rising from December, while Manufacturing Production is expected to remain relatively unchanged. - Investors will be watching Payrolls data in the US today. The Change in Nonfarm Payrolls for the month of February is expected at 95K. Note that on Wednesday the ADP employment change was 57K against estimates of 100K. Wednesday's ADP figure was the first reading since the ADP ammended the methodology used for the calculation. The sample size was been increased by about 100K to cover about 350K of ADP's 500K customers. Note that, in an interview on CNBC, an ADP representative said that the ADP current ADP figure will best represent next month's revision to this month's Nonfarm figure (ie. the ADP figure best represents March's revion to February's data). Furthermore the representative said that for the current month, in ADP's view, a relatively accurate figure could be obtained by giving the ADP reading a 40% weighting, and general consensus estimates a 60% weighting, and then averaging out the data. This calculates out to approximately 110K. Note that a derivative auction on Wednesday yielded 99K, while a derivative today yielded 82.5K. Data is due out at 8:30 ET.