Investors don't seem to be driving markets too far in either direction and after little by way of surprise to a report showing the pace of U.S. output, traders have little impetus to push much further. Yields still appear elevated after a 40 basis point surge since politicians agreed an extension for tax cuts. Curve movement remains limited although the weight of warnings from credit ratings agencies over possible further downgrades for European sovereigns is pushing core German yields down again.

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